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Sep 30, 2023
ACCO Brands Q3 2023 Earnings Report
ACCO Brands' Q3 2023 performance was highlighted by gross margin improvement and strong free cash flow.
Key Takeaways
ACCO Brands reported net sales of $448 million with a gross margin expansion of 400 basis points. Operating income was $32 million, and adjusted operating income grew 8% to $46 million. EPS was $0.15, and adjusted EPS was $0.24. The company maintains its full-year 2023 free cash flow outlook of at least $110 million.
Net sales declined 7.7 percent to $448.0 million.
Gross margins expanded 400 basis points year over year.
Adjusted operating income increased 7.5 percent to $46.0 million.
The Company reported net income of $14.9 million, or $0.15 per share.
Forward Guidance
The company expects reported sales for 2023 to be down 6% to 7%. The full year adjusted EPS outlook is expected to be in the range of $1.03 to $1.07. Free cash flow outlook is maintained at least $110 million and expects to end the year with a consolidated leverage ratio of approximately 3.5x.
Positive Outlook
- Low double-digit growth in adjusted operating income is expected.
- Maintaining 2023 free cash flow outlook to at least $110 million.
- Expects to end the year with a consolidated leverage ratio of approximately 3.5x.
Challenges Ahead
- Reported sales for 2023 are now expected to be down 6 percent to 7 percent.
- Full year adjusted EPS outlook is now expected to be in the range of $1.03 to $1.07.
- Low double-digit growth in adjusted operating income is expected to be mostly offset by higher interest and non-cash, non-operating pension expenses.
- Continued soft demand due to economic uncertainty.
- Stronger U.S. dollar.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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