ACCO Brands (ACCO) Q4 2023 earnings summary

Executive summary

• FY2023 net sales were $1.833B, down 5.9%; adjusted operating income rose to $204.8M, adjusted EPS was $1.09, and gross margin expanded 420 bps.

• Adjusted free cash flow was $117.5M, up $40.0M; debt fell $88M and year-end consolidated leverage was 3.4x.

Financial highlights

• FY GAAP operating income was $44.7M versus $34.8M; net loss was $21.8M versus $13.2M, including an $89.5M non-cash goodwill impairment.

• FY adjusted operating income rose to $204.8M from $175.8M; adjusted net income was $105.6M and adjusted EPS was $1.09 versus $1.04.

• Q4 net sales were $488.6M, down 2.2%; comparable sales fell 4.6%, while FX added $12.2M, or 2.4%.

• Q4 GAAP operating loss was $52.8M; adjusted operating income rose 30.6% to $68.3M and adjusted EPS increased to $0.39 from $0.32.

Outlook and guidance

• FY2024 reported sales are expected to decline 2.0%–5.0% to $1.740B–$1.788B; comparable sales guidance is down 2.5%–5.5%.

• FY2024 adjusted EPS guidance is $1.07–$1.11; free cash flow is at least $120M and year-end leverage is 3.0x–3.2x.

• Q1 2024 reported sales guidance is down 6.5%–8.0%, with adjusted EPS of $0.01–$0.04; back-to-school shipment timing may shift sales between Q1 and Q2.

• A multi-year restructuring program targets at least $60M in annualized pre-tax savings once fully implemented.