Quad Graphics, Inc · NYSE:QUAD
Quad Graphics — Investor Day (November 2024)
24 slides from Quad Graphics's investor day presentation, Nov 20, 2024
Slide 1: Investor Day agenda and presenters
November 20, 2024 EXHIBIT 99.1 Don Pontes, Executive Director of Investor Relations Quad 2 Chairman, President & CEO Chief Marketing Officer President of Media President, Quad Agency Solutions & EVP, Product & Market Strategy EVP & Chief Operating Officer Chief Financial OfficerEVP & Chief Revenue O
Slide 2: Forward-looking statements
This communication contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements regarding, among other things, our current expectations about the Company’s future results, financial condition,
Slide 3: Management team and strategic priorities
RETAIL GROCERY PUBLISHING CPG FINANCE & INSURANCE HEALTH DIRECT-TO- CONSUMER Quad 9 Executive Vice President & Chief Operating Officer Joined Quad: 2009 Journal Communications, Newell Brands, Arthur Andersen Chief Marketing Officer Joined Quad: 2021 Ad Age, Xerox, NBC Universal, Grey Group, Havas, Y
Slide 4: Awards, marketing vision and challenges
Top Printing Companies in the U.S. and Canada PERFORMANCE CREATIVITY INNOVATION 2019 “Best in Show” Top 40 Digital Marketing Strategists National Gold Winner for Art Direction Tulip Award for Sustainable Performance Performance marketing agencies in the world TOP 5 by World’s Largest Agency Companie
Slide 5: Marketing experience offering and history
Diversified offering to support client needs of integrated and omnichannel marketing services Built a strong print platform that continues today 1971 Acquired to extend print offering and improve efficiencies Household In-Store Online 2010 2018 Helping brands make direct consumer connections, from h
Slide 6: Talent, client and engagement growth
Talent Growth President of Media UM Worldwide, MediaVest, News Corp Continuing to attract a new wave of talent across agency, data, media & tech Head of Client Experience Tyson Foods, Starcomm Client Growth Opening doors to new customers and industry verticals Engagement Growth YTD New LinkedIn Foll
Slide 7: Home-address based identity and data
Cookie Device- ID Deprecation Email Addresses Only One Place You Call Home Identity is built from the place you call home Data & Privacy Regulations Mobile Numbers Home Addresses Quad 25 Quad 26 Quad 27 121M Househ o ld s Quad’s core dataset features 250M consumers, mapped to a resilient identifier
Slide 8: Data attributes for consumers and households
US Consumers Attributes US Households Demographic • Age • Income • Ethnicity • Education • Adults in Household • Principal Shopper • Children • Spouse • Households • Head of Household • Business Owner • Employment • Lifestyles • Political Affiliation • Leisure Activity Transactions Shopping • Transa
Slide 9: Data-fueled audience-led strategies
Quad 33 Data fueled, audience-led strategies for creative, media, and print: • Omnichannel audience view • Channel agnostic • Measurable impact and results With joint opportunities in creative and media more common, our unholding company approach to data is a key differentiator “Please create optimi
Slide 10: Media approach and fireside chat with Tim Armstrong
Scale with Agility Client First Media Investment Brand and Performance Transparency and Accountability We are not beholden to industry broken operating models Quad 37 Josh Golden Chief Marketing Officer Tim Armstrong Founder and CEO, Flowcode Special Guest Quad 38 Eric Ashworth President, Quad Agenc
Slide 11: Innovation process and new product examples
PHASE 1 Concept & Ideas PHASE 2 Business Case PHASE 3 Design & Planning PHASE 4 Pilot & Validate INNOVATION INSIDE OUT OUTSIDE IN • The Offering • Target Segment • Client Value Proposition • Quad Value Proposition • Competition • Market Sizing • Voice of Customer • SWOT Analysis • Build vs. Buy • Fi
Slide 12: Retail media market and in-store opportunity
Source: EMARKETER Forecast, March 2024 77% 7% 8% Amazon Walmart 3% Target 2% Instacart Others Retail Media Ad Revenue Share, by Company US, 2024, % of Retail Media Digital Ad Spending Quad 45 80% More Than of Retail Sales Happen in Physical Stores Source: EMARKETER, “In-Store Retail Media 2024,” May
Slide 13: In-store screens and estimated weekly audience
Number of Screens Per Store 14 Estimated Weekly Audience 3,750,000 Number of Screens Per Store 14 Estimated Weekly Audience 12,000,000 Quad 49 Quad 50 Traditional Channels Traditional Media Radio, OOH, Direct Mail, Digital, TV, Search Educational & Informational Media Social, Website, Blog, Targeted
Slide 14: In-store media across the customer journey
Awareness Consideration Perimeter and endcap displays Purchase Customer Journey Stage Quad 53 Awareness Consideration Purchase SKU specific Customer Journey Stage Quad 54 Quad 55 Install, Maintenance & Audit Electrical Reporting & Insights Sales Strategy & Support Network Design Procurement Project
Slide 15: In-store proof of concept and expansion
“ ” Quad 57 Tamara Pattison Chief Digital Officer 15 stores Q3 2024 Proof of Concept #1 Q4 2024 Proof of Concept #2 2025 and Beyond Expansion Strategies 15 stores 15 stores + 3rd Grocery Client National coverage to rival platforms Programmatic and client side buying Test adjacent scaled retail verti
Slide 16: Client success stories
MX: Intelligence • Audience Analytics • Campaign Development • Performance Data MX: Creative • Premedia & Adaptive Design • Creative Templates MX: Production • Direct Mail • Print & Postal Logistics MX: Media • Addressable Media MX: Tech • Order Management System • Direct Mail Automation From an off
Slide 17: Operations update: efficient flexible model
Dave Honan, EVP & Chief Operating Officer Quad 65 A highly efficient and flexible model that drives margin growth and delivers value to our clients on our marketing experience promise Quad 66 Investing in automation and reducing fixed costs to flex efficiently with volume demand Providing a safe wor
Slide 18: Innovation Center and postage solutions
Marketing Experience Innovation Center Quad 69 • Transformed 900,000 square- foot, West Allis, Wisconsin magazine and catalog printing facility into an Innovation Center to support growing In-Store offering • Exited four leased facilities previously used for Quad In-Store operations • Room for futur
Slide 19: International footprint and Europe sale
Latin America Quad 73 Europe • Agreed to sell the majority of our European operations for approximately $45M to Capmont by year end • Optimizes our business portfolio for growth as a marketing experience company Lima, Perú Bogotá, Colombia Santo Domingo, Dominican Republic México (2): Toluca, Xochim
Slide 20: Net sales mix and long-term margin profile
32% Integrated Solutions Agency Logistics 11% Large Scale Print Magazines Retail Inserts 47% Targeted Print Catalogs Direct Marketing Packaging In-Store Special Interest Publications Net Sales Estimate Services 22% Integrated Solutions Agency Logistics 23% Large Scale Print Magazines Retail Inserts
Slide 21: Debt ladder and capital allocation
$43 $23 $40 $35 $37 $193 $73 2024 2025 2026 2027 2028 2029 $299 $33 Term Loan A (Amortization) Revolving Credit Facilities(1) Term Loan A (Maturity) Debt Ladder ($ Millions)• Extended $690 million Term Loan A and Revolving Credit Agreement through 2029 • Next significant maturity is $193 million due
Slide 22: Strategy summary and questions
Online Media Expansion Content Execution at Scale Print Consolidation & Diversification Data Differentiation Quad Creative Quad 85 Quad Data Systems Print Media Placement Print Organic Growth Quad 86 Quad Virtual attendees may submit questions to IR@quad.com 87
Slide 23: Non-GAAP financial measures
• In addition to financial measures prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), this presentation also contains non-GAAP financial measures, specifically EBITDA, EBITDA Margin, Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow,
Slide 24: Net debt and Adjusted EBITDA reconciliation
US $ Millions September 30, 2024 December 31, 2023 Total debt and finance lease obligations on the balance sheets $ 502.8 $ 522.7 Less: Cash and cash equivalents 12.5 52.9 Net Debt (non-GAAP) $ 490.3 $ 469.8 Divided by: trailing twelve months Adjusted EBITDA (non-GAAP) (1) $ 227.1 $ 233.7 Debt Lever