Acco Brands Corporation · NYSE:ACCO
Acco Brands — Q1 2024 Earnings Presentation
18 slides from Acco Brands's earnings presentation, May 3, 2024
Slide 1: ACCO Brands 1Q Earnings Conference Call, May 3, 2024
ACCO Brands | 1Q Earnings Conference Call | May 3, 2024
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements contained herein, 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 financial condition, a
Slide 3: Reg. G – Non-GAAP Financial Measures
Reg. G – Non-GAAP Financial Measures An explanation of how we calculate each of our Non-GAAP financial measures and a reconciliation of our current period and historical non-GAAP financial measures to the most directly comparable GAAP financial measures can be found at the end of this presentation.
Slide 4: 1Q 2024 Key Messages
1Q Tet2024 Key Messages • Reported net and comparable sales down due to weaker consumer and business spending and from the exit of lower margin business • Lower demand for end of season back-to-school in Brazil • Computer accessories rate of decline is moderating • Gaming accessories grew • Gross ma
Slide 5: 1Q Results Summary
1Q Results Summary Comparison Versus Prior Year SALES • Volume impacted globally by weaker consumer and business spending and from the exit of lower margin business in the Americas segment Down 11% to $359M; • Americas sales decline reflects industry wide trends and lower season end demand for back-
Slide 6: 1Q Segment Financial Metrics
1Q Segment Financial Metrics Y/Y $ in millions 1Q 2024 1Q 2023 Change ACCO Brands Americas Sales $197.1 $230.0 (14.3%) Comparable Sales $194.8 $230.0 (15.3%) Adjusted Operating Income $12.3 $18.7 (34.2%) Adjusted Operating Margin 6.2% 8.1% (190 bps) ACCO Brands International Sales $161.7 $172.6 (6.3
Slide 7: 1Q Segment Results Summary
1Q Segment Results Summary Comparison Versus Prior Year Americas International • Lower sales due to softer • Lower sales due to softer consumer and business consumer and business demand and from the exit of demand for legacy products low margin business • Computer accessories rate • Lower end-of-sea
Slide 8: 1Q 2024 Margin Reconciliation
1Q 2024 Margin Reconciliation 1Q Change vs. Items of Significant Bps 2024 Prior Year Impact Gross Profit $110.4M ($8.9M) Pricing/Product Cost 140 Cost Savings 50 Gross Margin 30.8% +120 Bps Volume (120) FX/Other 50 SG&A $94.2M ($0.8M) Cost Savings (90) Sales Deleverage 290 SG&A Margin 26.2% (260 bps
Slide 9: Free Cash Flow
Free Cash Flow Change vs $ in millions* 1Q 2024 1Q 2023 2023 Net cash provided by operations 28 (23) 51 Additions to PP&E (2) (2) -- Free cash flow 26 (25) 51 Dividends paid (7) -- (7) Other, net (2) (2) -- Increase in debt 42 90 (48) Increase in cash on hand 58 65 (7) Debt/Cash Reconciliation Debt
Slide 10: Capital Structure
Capital Structure ($ in millions) Facility Balance1 Interest Rate Methodology Rate $600M multicurrency revolver 71 SOFR + CSA3 + 175 bps, 30 bps unused 7.07% USD Term Loan A 76 SOFR + CSA3 + 175 bps 7.18% EUR Term Loan A 208 EURIBOR + 175 bps 5.65% AUD Term Loan A 30 Australian BBSR + 175 bps 6.17%
Slide 11: Full Year 2024 Outlook
Full Year 2024 Outlook Guidance FY2024 Reported Net Sales Growth (5.0%) to (7.0%) Reported Net Sales* $1.700 to $1.740 billion FX Impact on Sales* Approximately 0.0% Comparable Sales Growth (5.0%) to (7.0%) Adjusted EPS $1.02 to $1.07 Free Cash Flow At Least $120 million Adjusted Tax Rate Approximat
Slide 12: 2Q 2024 Outlook
2Q 2024 Outlook Guidance 2Q 2024 Reported Net Sales Growth (7.0%) to (9.0%) Reported Net Sales* $450 to $460 million FX Impact on Sales* 0.0% Comparable Sales Growth (7.0%) to (9.0%) Adjusted EPS $0.30 to $0.33 *Translation impact based on spot rates as of 03/31/2024 Notes: Comparable Sales and Adju
Slide 13: Executing On Capital Allocation Strategy
Executing On Capital Allocation Strategy Shareholder Capital Allocation Debt Reduction Returns Disciplined capital allocation Gross debt down $138 million Declared $0.075 per share strategy with a more balanced year-over-year quarterly dividend on April 26th view longer-term Free Cash Flow improved
Slide 14: About Non-GAAP Financial Measures
About Non-GAAP Financial Measures Our non-GAAP financial measures include the following: Comparable Sales: Represents net sales excluding the impact of material acquisitions, if any, with current-period foreign operation sales translated at prior-year currency rates. We believe comparable sales are
Slide 15: 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 sct forth a reconciliation of certain Consolidated Statements of Loss information reported in accordance with G
Slide 16: Reg G Reconciliations
Reg G Reconciliations ACCO Brands Corporation and Subsidiaries Reconciliation of Net Loss to Adjusted EBITDA (Unaudited) (In millions) ‘The following table sets forth a reconciliation of net loss reported in accordance with GAAP to Adjusted EBITDA. % Change Net loss 70.3% ‘Stock-based compensation 3
Slide 17: Reg G Reconciliations
Reg G Reconciliations ACCO Brands Corporation and Subsidiaries ‘Supplemental Business Segment Information and Reconciliation (Unaudited) (In millions) 2024 2023 Changes “Rajusted Kijased Reported ‘Adjusted — Operating Reported Adjusted Operating ‘Adjusted Adjusted Operating Operating Income Operatin
Slide 18: Reg G Reconciliations
Reg G Reconciliations ACCO Brands Corporation and Subsidiaries Supplemental Net Sales Change Analysis (Unaudited) ‘Ye Change - Net Sales sc GAAP ‘Non-GAAP ‘GAAP Currency ‘Comparable Sales [Net Sales Change| Translation Change (A) Net Sales Change [Comparable Sales} QI 2024: ACCO Brands Americas (14.