Slide 1: First Quarter 2010 Financial Review and Analysis
Supplemental Presentation Materials First Quarter 2010 Financial Review and Analysis (preliminary, unaudited) April 27, 2010 DRAFT - 4/26 145PM
Slide 2: Forward-looking statements
2 April 27, 2010 First Quarter 2010 Financial Review and Analysis Certain statements contained in this document are "forward-looking statements" intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements
Slide 3: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures This presentation contains certain non-GAAP measures as defined by SEC rules. The most directly comparable GAAP measures have been included in the earnings news release for the quarter. Reconciliations of non-GAAP measures to the most directly comparable GAAP measu
Slide 4: Key Trends and Major Initiatives
Key Trends and Major Initiatives Solid top line growth across all major regions of operation, with particular strength in emerging markets While gross profit margins in most businesses remained solid for the quarter, inflationary pressure intensified; additional rounds of price increase planned On t
Slide 5: First Quarter Summary
April 27, 2010 First Quarter 2010 Financial Review and Analysis First Quarter Summary Net sales grew 9% from prior year Currency translation increased reported sales growth by approx. 5 points Extra week of sales in first quarter of 2009 reduced reported sales growth by approx. 3 points On an organi
Slide 6: First Quarter Summary (continued)
April 27, 2010 First Quarter 2010 Financial Review and Analysis First Quarter Summary (continued) On a sequential basis, operating margin before restructuring and other items improved 170 basis points Higher volume and the benefits of restructuring and productivity initiatives more than offset the n
Slide 7: Sales Trend Analysis
Sales Trend Analysis April 27, 2010 First Quarter 2010 Financial Review and Analysis 7 Reported Sales Change (13.3%) (20.4%) (10.2%) 0.7% 9.0% 1Q09 2Q09 3Q09 Organic Sales Change(1) (14.5%) (13.5%) (5.9%) (0.6%) 7.3% Acquisitions 0.6% -- -- -- -- Currency (6.4%) (6.9%) (4.3%) 4.5% 4.9% Extra Week 7.
Slide 8: Margin Analysis
8 Gross Profit Margin (total Company) 28.4% 24.2% 27.3% Operating Margin (non-GAAP(1)): Pressure-sensitive Materials 10.0% 5.9% 7.5% Retail Information Services 0.8% (3.6%) 0.7% Office and Consumer Products 11.2% 14.2% 13.5% Other specialty converting businesses 2.3% (10.4%) (4.2%) Total Company 6.5
Slide 9: Key Factors Impacting Margin
Key Factors Impacting Margin Gross profit margin improved 420 basis points vs. prior year to 28.4% due to increased volume and the benefits of restructuring and productivity initiatives Marketing, general and administrative (MG&A) expense ratio increased by 60 basis points compared to the prior year
Slide 10: First Quarter Segment Overview
10 First Quarter Segment Overview PRESSURE-SENSITIVE MATERIALS Reported sales of $897 mil., up 11% compared with prior year Organic sales growth of approx. 8% Rate of change in sales (organic basis) for roll materials business, by region: Europe: mid single-digit increase North America: mid single-d
Slide 11: First Quarter Segment Overview (continued)
11 First Quarter Segment Overview (continued) RETAIL INFORMATION SERVICES Reported sales of $345 mil., up 9% compared with prior year Organic sales growth of approx. 10% Q1 comparison benefited from significant inventory destocking in prior year Operating margin before restructuring charges and othe
Slide 12: First Quarter Segment Overview (continued)
12 First Quarter Segment Overview (continued) OFFICE AND CONSUMER PRODUCTS Sales of $180 mil., down 2% compared with prior year on both a reported and organic basis Excluding restructuring costs, operating margin declined to 11.2% due to increased spending related to customer programs, as well as hi
Slide 13: First Quarter Cash Flow
April 27, 2010 First Quarter 2010 Financial Review and Analysis 13 13 First Quarter Cash Flow
Slide 14: Update to Contributing Factors to 2010 Financial Results
Update to Contributing Factors to 2010 Financial Results April 27, 2010 First Quarter 2010 Financial Review and Analysis 14 One less week in the fiscal year; 13 weeks in the first quarter vs. 14 in 2009 (represents a decrease in sales of ~ $50 mil. with a minimal impact to earnings) At current rates
Slide 15: 2010 Earnings and Free Cash Flow Guidance
2010 Earnings and Free Cash Flow Guidance 2010 Guidance Reported (GAAP) Earnings Per Share $2.38 - $2.68 Add Back: Estimated Restructuring and Asset Impairment Charges ~ $0.12 Adjusted (non-GAAP) Earnings Per Share $2.50 to $2.80 Capital Expenditures & Investments in Software $125 to $150 mil. Free
Slide 16: A ves
A ves DENNISON