Acco Brands Corporation · NYSE:ACCO
Acco Brands — Q2 2022 Earnings Presentation
18 slides from Acco Brands's earnings presentation, Aug 9, 2022
Slide 1: ACCO Brands 2Q Earnings Conference Call
ACCO Brands 2Q Earnings Conference Call August 9, 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements contained in this presentation, other than statements of historical fact, particularly those anticipating future financial performance, business prospects, growth, strategies, business operations and similar matters, results of operations, liquidity and financia
Slide 3: Reg. G – Non-GAAP Financial Measures
Reg. G – Non-GAAP Financial Measures This presentation contains non-GAAP financial measures. We explain how we calculate and use each of these non-GAAP measures and provide a reconciliation of our current period and historical non-GAAP financial measures to the most directly comparable GAAP financia
Slide 4: 2Q 2022 Results Summary
2Q 2022 Results Summary Comparisons Versus Prior Year • FX headwind of $24M • North America back-to-school sell-in consistent with expectations Sales up 1% to $521M • Strong recovery in International segment Comparable sales up 5% to $545M • EMEA price increases offset by volume declines • Gaming ac
Slide 5: 2Q 2022 Segment Results Summary
2Q 2022 Segment Results Summary Comparisons Versus Prior Year • Sales up from higher prices North America sales $307M, up 4% • Strong back-to-school sell-in consistent with expectations Comparable sales $308M, up 4% • Gaming accessories sales declined due to market conditions • Operating/adjusted op
Slide 6: 2022 Segment Results
2022 Segment Results Y/Y Segment Financial Metrics 2Q22 2Q21 $ in millions Change ACCO Brands North America Sales $306.6 $295.1 3.9% Comparable Sales $308.0 $295.1 4.4% Adjusted Operating Income $57.2 $59.9 (4.5%) Adjusted Operating Margin 18.7% 20.3% (160 bps) ACCO Brands EMEA Sales $137.9 $157.0 (
Slide 7: 2Q 2022 Margin Reconciliation
2Q 2022 Margin Reconciliation 2Q 2022 Change vs. Items of Significant Impact Adjusted Prior Year Bps on Adjusted Results (non-GAAP) Adjusted Gross Profit $150.0M ($14.1M) Pricing/Product Cost (290) Cost Savings 50 Gross Margin 28.8% (290) bps Mix/Other (50) SG&A $91.9M ($5.0M) Sales Leverage (100) I
Slide 8: 2022 Cash Flow
2022 Cash Flow Change vs $ in millions* 2Q22 1Q22 2022 YTD 2021YTD 2021 Adjusted EBITDA 71 39 110 125 (15) Interest (4) (15) (19) (17) (2) Taxes (11) (8) (19) (15) (4) Capital expenditures (4) (3) (7) (9) 2 Working capital and other (38) (114) (152) (130) (22) Pension (2) (5) (7) (11) 4 Cash restruc
Slide 9: Capital Structure
Capital Structure Capital structure as of June 30, 2022 No maturities until 2026 ($ in millions) Facility Balance1 Interest Rate Methodology Rate $600M multicurrency revolver 240 LIBOR + 200 bps, 35.0 bps unused 3.42% USD Term Loan A 87 U.S. LIBOR + 200 bps 4.25% EUR Term Loan A 229 Euro LIBOR (
Slide 10: Full Year 2022 Outlook
Full Year 2022 Outlook ($ in millions, except EPS) Current Outlook Mid-Point Prior Outlook Mid-Point Comparable Net Sales Growth 4.0% to 6.0% 5.0% 3.5% to 8.5% 6.0% FX Impact on Net Sales (1) (4.5%) (2.5%) Reported Net Sales Growth (0.5%) to 1.5% 0.5% 1.0% to 6.0% 3.5% Comparable Adjusted EPS $1.45
Slide 11: Executing On Capital Allocation Strategy
Executing On Capital Allocation Strategy • Disciplined capital allocation strategy Capital • 2H 2022 priority on dividend payments and debt reduction Allocation • 2Q 2022 bank net leverage 3.97x, due to seasonal use of cash in 1H Debt • Expect an approximate 3.0x bank net leverage ratio at year-end
Slide 12: About Non-GAAP Financial Measures
About Non-GAAP Financial Measures Our non-GAAP financial measures include the following: Comparable Net Sales: Represents net sales excluding the impact of acquisitions with current-period foreign operation sales translated at prior-year currency rates. We believe comparable net sales are useful to
Slide 13: Reg G Reconciliations
Reg G Reconciliations ACCO Brands Corporation and Subsidiaries Reconciliation of GAAP to Adjusted Non-GAAP Information (Unaudited) (In millions, except per share data) The following tables set forth a reconciliation of certain Consolidated Statements of Income information reported in accordance with
Slide 14: Reg G Reconciliations
Reg G Reconciliations ‘The following tables sct forth a reconciliation of certain Consolidated Statements of Income information reported in accordance with GAAP to adjusted Non-GAAP Information for the six months ended June 30, 2022 and 2021 Reported GAAP Reparted GAAP diluted imcume per share (EPS)
Slide 15: Reg G Reconciliations
Reg G Reconciliations ACCO Brands Corporation and Subsidiaries Reconciliation of Net Income to Adjusted EBITDA (Unaudited) (In millions) The following table sets forth a reconciliation of net income reported i accordance with GAAP to Adjusted EBITDA. ‘Three Months Ended Six Months Ended June 30, Jun
Slide 16: Reg G Reconciliations
Reg G Reconciliations Notes to Reconciliations of GAAP to Adjusted Non-GAAP Information and Net Income to Adjusted EBITDA (Unaudited) > Represents a net charge to operating expense related to our Russia business. Represents the change in fair value of the contingent consideration for the PowerA acqu
Slide 17: Reg G Reconciliations
Reg G Reconciliations ACCO Brands Corporation and Subsidiaries Supplemental Business Segment Information and Reconciliation (Unaudited) 22 2021 Changes ‘Adjusted ‘Adjusted Reported Adjusted Operating Reported Adjusted Operating Adjusted Adjusted Operating Operating Income Operating Operating Income
Slide 18: Reg G Reconciliations
Reg G Reconciliations ACCO Brands Corporation and Subsidiaries Supplemental Net Sales Change Analysis (Unaudited) ‘a Change - Net Sales $ Change - Net Sales (in millions) GAAP Non-GAAP GAAP Non-GAAP ‘Comparable ‘Comparable Net Sales Currency Net Sales Net Sales Currency Net Sales Comparable Change T