Industry volume and pricing pressures continued to drive revenue down, but Sussex-based Quad/Graphics Inc. reported improved earnings for the fourth quarter and full year due to better operating performance.
The company reported net income of $37.5 million in the fourth quarter, compared to a $9.4 million loss during the same period in 2015. Earnings also improved from a 20 cent loss to earnings of 73 cents per diluted share. Revenue was down 8.8 percent in the quarter to $1.2 billion.
For the full year, Quad reported net income of $44.9 million, compared to a $641.9 million loss in 2015. The result was earnings of 90 cents per diluted share, an improvement over 2015’s $13.40 per share loss. Revenue, however, declined 5.8 percent to $4.3 billion.
“We are pleased with our fourth quarter and full-year 2016 results, which exceeded our expectations and show that we more than accomplished what we set out to achieve at the start of the year,” said Joel Quadracci, Quad/Graphics chairman, president and chief executive officer.
He noted the company had continued to transform its business through strategic investments while also implementing sustainable cost reductions. Since 2010, Quad has made a number of acquisitions to consolidate the printing industry and has sought to bring production to high efficiency plants while closing outdated ones. The company has now transitioned to a new role, one that has the firm partnering with customers to optimize their marketing investments.
“As we look forward to 2017, we plan to continue to take advantage of our unique position in the industry as both a global printer and a marketing services provider,” Quadracci said. “We will leverage our growing BlueSoho integrated marketing agency, as well as our strategic investment in Rise Interactive, to create innovative, end-to-end solutions for our customers that will allow them to improve both the efficiency and effectiveness of their media spend across multiple channels.”
The company’s 2017 guidance calls for revenues to be in a range of $4.1 billion to $4.3 billion, continuing a downward trend created by industry volume and pricing pressures.
Quadracci said the company is largely taking a wait-and-see approach when it comes to what changes President Donald Trump’s administration would bring about. At the same time, he said the level of change and disruption taking place in the industries Quad is involved in creates opportunities.
“I think a lot of our customers are looking at themselves and trying to speed up their own transformations,” he said, suggesting Quad has additional opportunities to talk with customers and help them make sense of things.
