EX-99.1 2 exhibit991-discontinue.htm EXHIBIT 99.1 Exhibit


Exhibit 99.1
QUAD/GRAPHICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)
(UNAUDITED)
 
Three Months Ended
 
Nine Months Ended
 
March 31,
2019
 
June 30,
2019
 
September 30,
2019
 
September 30,
2019
Net sales
$
961.0

 
$
948.9

 
$
943.6

 
$
2,853.5

Cost of sales
788.3

 
771.5

 
764.5

 
2,324.3

Selling, general and administrative expenses
94.5

 
96.4

 
99.6

 
290.5

Depreciation and amortization
54.2

 
52.9

 
52.2

 
159.3

Restructuring, impairment and transaction-related charges
7.6

 
9.4

 
56.7

 
73.7

Total operating expenses
944.6

 
930.2

 
973.0

 
2,847.8

Operating income (loss) from continuing operations
16.4

 
18.7

 
(29.4
)
 
5.7

Interest expense
21.8

 
25.8

 
22.0

 
69.6

Net pension income
(1.5
)
 
(1.5
)
 
(1.5
)
 
(4.5
)
Loss on debt extinguishment
15.9

 
—

 
14.6

 
30.5

Loss from continuing operations before income taxes and equity in loss of unconsolidated entity
(19.8
)
 
(5.6
)
 
(64.5
)
 
(89.9
)
Income tax benefit
(7.2
)
 
(3.2
)
 
(17.6
)
 
(28.0
)
Loss from continuing operations before equity in loss of unconsolidated entity
(12.6
)
 
(2.4
)
 
(46.9
)
 
(61.9
)
Equity in loss of unconsolidated entity
0.1

 
0.7

 
0.1

 
0.9

Net loss from continuing operations
(12.7
)
 
(3.1
)
 
(47.0
)
 
(62.8
)
Loss from discontinued operations, net of tax
(10.1
)
 
(11.6
)
 
(79.4
)
 
(101.1
)
Net loss
(22.8
)
 
(14.7
)
 
(126.4
)
 
(163.9
)
Less: net earnings (loss) attributable to noncontrolling interests
(0.3
)
 
0.1

 
0.1

 
(0.1
)
Net loss attributable to Quad common shareholders
$
(22.5
)
 
$
(14.8
)
 
$
(126.5
)
 
$
(163.8
)
 
 
 
 
 
 
 
 
EBITDA and Adjusted EBITDA (Non-GAAP)
 
 
 
 
 
 
 
Net loss attributable to Quad common shareholders
$
(22.5
)
 
$
(14.8
)
 
$
(126.5
)
 
$
(163.8
)
Interest expense
21.8

 
25.8

 
22.0

 
69.6

Income tax benefit
(7.2
)
 
(3.2
)
 
(17.6
)
 
(28.0
)
Depreciation and amortization
54.2

 
52.9

 
52.2

 
159.3

EBITDA (Non-GAAP)
$
46.3

 
$
60.7

 
$
(69.9
)
 
$
37.1

EBITDA Margin (Non-GAAP)
4.8
%
 
6.4
%
 
(7.4
)%
 
1.3
%
 
 
 
 
 
 
 
 
Restructuring, impairment and transaction-related charges
$
7.6

 
$
9.4

 
$
56.7

 
$
73.7

Loss from discontinued operations, net of tax
10.1

 
11.6

 
79.4

 
101.1

Net pension income
(1.5
)
 
(1.5
)
 
(1.5
)
 
(4.5
)
Loss on debt extinguishment
15.9

 
—

 
14.6

 
30.5

Other
—

 
0.8

 
0.4

 
1.2

Adjusted EBITDA (Non-GAAP)
$
78.4

 
$
81.0

 
$
79.7

 
$
239.1

Adjusted EBITDA Margin (Non-GAAP)
8.2
%
 
8.5
%
 
8.4
 %
 
8.4
%



QUAD/GRAPHICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)
(UNAUDITED)
 
Three Months Ended
 
Year Ended
 
March 31,
2018
 
June 30,
2018
 
September 30,
2018
 
December 31,
2018
 
December 31,
2018
Net sales
$
922.6

 
$
964.8

 
$
973.5

 
$
1,124.9

 
$
3,985.8

Cost of sales
749.4

 
777.9

 
777.0

 
917.1

 
3,221.4

Selling, general and administrative expenses
83.4

 
96.2

 
89.2

 
90.1

 
358.9

Depreciation and amortization
52.6

 
54.4

 
55.0

 
52.9

 
214.9

Restructuring, impairment and transaction-related charges
24.9

 
10.4

 
5.3

 
62.7

 
103.3

Total operating expenses
910.3

 
938.9

 
926.5

 
1,122.8

 
3,898.5

Operating income from continuing operations
12.3

 
25.9

 
47.0

 
2.1

 
87.3

Interest expense
17.2

 
18.4

 
18.3

 
19.3

 
73.2

Net pension income
(3.1
)
 
(3.1
)
 
(3.1
)
 
(3.1
)
 
(12.4
)
Earnings (loss) from continuing operations before income taxes and equity in (earnings) of unconsolidated entity
(1.8
)
 
10.6

 
31.8

 
(14.1
)
 
26.5

Income tax expense (benefit)
(1.9
)
 
(2.4
)
 
4.5

 
(2.6
)
 
(2.4
)
Earnings (loss) from continuing operations before equity in (earnings) of unconsolidated entity
0.1

 
13.0

 
27.3

 
(11.5
)
 
28.9

Equity in (earnings) of unconsolidated entity
(0.3
)
 
(0.2
)
 
(0.2
)
 
(0.3
)
 
(1.0
)
Net earnings (loss) from continuing operations
0.4

 
13.2

 
27.5

 
(11.2
)
 
29.9

Loss from discontinued operations, net of tax
(3.9
)
 
(3.7
)
 
(5.0
)
 
(9.4
)
 
(22.0
)
Net earnings (loss)
(3.5
)
 
9.5

 
22.5

 
(20.6
)
 
7.9

Less: net earnings (loss) attributable to noncontrolling interests
—

 
0.1

 
(0.9
)
 
0.2

 
(0.6
)
Net earnings (loss) attributable to Quad common shareholders
$
(3.5
)
 
$
9.4

 
$
23.4

 
$
(20.8
)
 
$
8.5

 
 
 
 
 
 
 
 
 
 
EBITDA and Adjusted EBITDA (Non-GAAP)
 
 
 
 
 
 
 
 
 
Net earnings (loss) attributable to Quad common shareholders
$
(3.5
)
 
$
9.4

 
$
23.4

 
$
(20.8
)
 
$
8.5

Interest expense
17.2

 
18.4

 
18.3

 
19.3

 
73.2

Income tax expense (benefit)
(1.9
)
 
(2.4
)
 
4.5

 
(2.6
)
 
(2.4
)
Depreciation and amortization
52.6

 
54.4

 
55.0

 
52.9

 
214.9

EBITDA (Non-GAAP)
$
64.4

 
$
79.8

 
$
101.2

 
$
48.8

 
$
294.2

EBITDA Margin (Non-GAAP)
7.0
%
 
8.3
%
 
10.4
%
 
4.3
%
 
7.4
%
 
 
 
 
 
 
 
 
 
 
Restructuring, impairment and transaction-related charges
$
24.9

 
$
10.4

 
$
5.3

 
$
62.7

 
$
103.3

Loss from discontinued operations, net of tax
3.9

 
3.7

 
5.0

 
9.4

 
22.0

Net pension income
(3.1
)
 
(3.1
)
 
(3.1
)
 
(3.1
)
 
(12.4
)
Employee stock ownership plan contribution
22.3

 
—

 
—

 
—

 
22.3

Other
(0.3
)
 
(0.1
)
 
(1.1
)
 
(0.1
)
 
(1.6
)
Adjusted EBITDA (Non-GAAP)
$
112.1

 
$
90.7

 
$
107.3

 
$
117.7

 
$
427.8

Adjusted EBITDA Margin (Non-GAAP)
12.2
%
 
9.4
%
 
11.0
%
 
10.5
%
 
10.7
%