Quad/Graphics (QUAD) Q2 2024 earnings summary

Executive summary

• Q2 2024 net sales were $634.2 million, down about 10% year-over-year, driven by lower print and agency solution sales and ongoing external headwinds such as postal rate hikes and high interest rates.

• Adjusted EBITDA rose to $52 million (8.2% margin), up from $50 million (7.2%) in Q2 2023, with operating income more than doubling to $15.1 million on improved productivity and cost controls.

• Adjusted diluted EPS for Q2 2024 was $0.12, up from $0.02 in Q2 2023; net loss narrowed to $2.8 million ($0.06 per share).

• Strategic focus remains on cost management, manufacturing optimization, integrated marketing solutions, and new service launches such as Betty creative agency and 3D Commerce.

• Recognition for creative and media excellence, with awards and new client wins in key verticals like retail and healthcare.

Financial highlights

• Q2 2024 net sales were $634.2 million, down from $703.1 million in Q2 2023; first half 2024 net sales were $1.3 billion, down 12% year-over-year.

• Adjusted EBITDA for Q2 2024 was $52 million (8.2% margin), up from $50 million (7.2%) in Q2 2023.

• Adjusted diluted EPS was $0.12 in Q2 2024, up from $0.02 in Q2 2023; year-to-date Adjusted EPS was $0.22, up from $0.17.

• Free cash flow for the first half of 2024 was negative $82 million, compared to negative $45 million in the prior year period.

• $4 million gain from the sale of a minority investment in Manipal Technologies contributed to margin improvement.

Outlook and guidance

• Full-year 2024 net sales expected to decline 5%-9% versus prior year, likely near the higher end of the decline range due to macroeconomic headwinds.

• Full-year Adjusted EBITDA guidance reaffirmed at $205-$245 million, with $225 million midpoint; sequentially higher EBITDA expected in the second half.

• Free cash flow for 2024 projected at $50-$70 million, with $60 million midpoint; capital expenditures expected at $60-$70 million.

• Debt leverage ratio targeted at approximately 1.8x by year-end 2024; net debt expected to be reduced to $405 million.