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Mar 31, 2023
ACCO Brands Q1 2023 Earnings Report
ACCO Brands' Q1 2023 results were highlighted by improved margins and cash flow.
Key Takeaways
ACCO Brands reported net sales of $403 million, exceeding expectations, with gross margins improving by 250 basis points year-over-year. Operating income increased by 49% to $10.1 million, and adjusted operating income grew by 8% to $24.3 million. The company reiterates its full-year 2023 outlook, supported by the better-than-expected first-quarter results.
Net sales reached $403 million, surpassing the company's outlook.
Gross margins improved by 250 basis points compared to the previous year.
Operating income increased by 49% year-over-year to $10.1 million.
Net operating cash outflow improved by $82 million due to better working capital management.
Forward Guidance
The Company is reaffirming its full year 2023 outlook and providing a 2Q outlook. For the full year, we expect comparable sales to be flat to down 3 percent, reflecting a challenging near-term demand environment. In the second quarter, we expect comparable sales to be down 4 percent to down 7 percent, with adjusted EPS within a range of $0.29 to $0.32.
Positive Outlook
- Full year adjusted EPS is expected to rise 4 percent to 8 percent, to $1.08 to $1.12
- Double-digit growth in adjusted operating income
- Foreign exchange is expected to be neutral to reported revenue.
- Company expects 2023 free cash flow to grow to at least $100 million
- Company expects to end the year with a consolidated leverage ratio of 3.5x to 3.7x.
Challenges Ahead
- Challenging near-term demand environment.
- Comparable sales to be flat to down 3 percent for the full year.
- Comparable sales to be down 4 percent to down 7 percent for the second quarter.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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