Wed, Apr 30, 6:54 PM (15 days ago)
**Quad/Graphics, Inc. (QUAD) Q1 2025 Financial Summary** **Financial Performance:** - **Revenue:** Total net sales decreased by 3.9% to $629.4 million, with product sales down 2.4% and service sales down 8.8%. - **Profit Margins:** Operating income improved to $19.6 million, a significant turnaround from a loss of $10.7 million in Q1 2024. Net earnings were $5.8 million, compared to a loss of $28.1 million in the prior year. - **Cash Flow:** Net cash used in operating activities increased to $89.0 million, primarily due to changes in operating assets and liabilities. Free Cash Flow decreased to $(100.3) million. **Segment Performance:** - **United States Print and Related Services:** Product sales decreased by 3.2%, and service sales decreased by 7.9%. Operating income improved significantly due to reduced restructuring and impairment charges. - **International:** Product sales increased by 2.0%, while service sales decreased by 37.0%. Operating income decreased due to higher restructuring and transaction-related charges. - **Corporate:** Operating expenses decreased slightly, with a minor increase in restructuring charges. **Financial Health and Future Operations:** - **Debt and Liquidity:** Total liquidity was $209.2 million, with $201.1 million of unused capacity under the revolving credit agreement. The Debt Leverage Ratio increased to 2.11x, above the target range. - **Dividends and Share Repurchases:** The company declared a quarterly dividend of $0.075 per share. Share repurchases totaled $3.3 million, with $74.2 million remaining under the program. - **Uncertainties and Trends:** The company faces challenges from increased business complexity, declining demand for printing services, and rising operating costs. Strategic investments and cost reduction initiatives are ongoing to maintain financial strength and shareholder value. **Management Discussion:** - **Strategic Focus:** Quad is transforming into a marketing experience (MX) company, focusing on integrated marketing services and technological advancements. - **Risk Management:** The company is actively managing risks related to interest rates, foreign currency fluctuations, credit risk, and commodity prices. - **Future Outlook:** Quad aims to drive profitable growth, maintain a strong balance sheet, and return capital to shareholders through dividends and share repurchases. The company is prepared to navigate uncertainties and capitalize on strategic opportunities.