0000950170-21-000089.txt : 20210505 0000950170-21-000089.hdr.sgml : 20210505 20210505070244 ACCESSION NUMBER: 0000950170-21-000089 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 14 CONFORMED PERIOD OF REPORT: 20210505 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20210505 DATE AS OF CHANGE: 20210505 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Donnelley Financial Solutions, Inc. CENTRAL INDEX KEY: 0001669811 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISCELLANEOUS BUSINESS SERVICES [7380] IRS NUMBER: 344829638 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-37728 FILM NUMBER: 21891117 BUSINESS ADDRESS: STREET 1: 35 WEST WACKER DRIVE CITY: CHICAGO STATE: IL ZIP: 60601 BUSINESS PHONE: 800-823-5304 MAIL ADDRESS: STREET 1: 35 WEST WACKER DRIVE CITY: CHICAGO STATE: IL ZIP: 60601 8-K 1 dfin-20210505.htm 8-K 8-K
false000166981100016698112021-05-052021-05-05

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 05, 2021

 

 

Donnelley Financial Solutions, Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware

001-37728

36-4829638

(State or Other Jurisdiction
of Incorporation)

(Commission File Number)

(IRS Employer
Identification No.)

 

 

 

 

 

35 West Wacker Drive

 

Chicago, Illinois

 

60601

(Address of Principal Executive Offices)

 

(Zip Code)

Registrant’s Telephone Number, Including Area Code: (800) 823-5304

 

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:


Title of each class

 

Trading
Symbol(s)

 


Name of each exchange on which registered

Common Stock (Par Value $0.01)

 

DFIN

 

The New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 


Item 2.02.               Results of Operations and Financial Condition

On May 5, 2021, Donnelley Financial Solutions, Inc. (the “Company”) issued a press release reporting the Company’s results for the first quarter ended March 31, 2021.

Information in this Item 2.02 and Exhibit 99.1 of Item 9.01 below shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise incorporated by reference into any filing pursuant to the Securities Act of 1933, as amended, or the Exchange Act except as otherwise expressly stated in such a filing.

Item 9.01.               Financial Statements and Exhibits

99.1            Press Release issued by Donnelley Financial Solutions, Inc. on May 5, 2021.

104             Cover Page Interactive Data File (embedded within the Inline XBRL document)

 


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

 

 

 

DONNELLEY FINANCIAL SOLUTIONS, INC.

 

 

 

 

 

Date: May 5, 2021

 

By:

 

/s/ DAVID A. GARDELLA

 

 

 

 

David A. Gardella

 

 

 

 

Chief Financial Officer

 

 


EX-99.1 2 dfin-20210505-ex99_1.htm EX-99.1 EX-99.1

 

Exhibit 99.1

 

img168995864_0.jpg

 

DFIN Reports First-Quarter 2021 Results

 

CHICAGO- May 5, 2021 – Donnelley Financial Solutions, Inc. (NYSE: DFIN), (the “Company”) today reported financial results for the first quarter of 2021.

 

 

First-quarter 2021

First-quarter 2020

 

 

Net Sales

$245.3 million

$220.7 million

 

 

Net Earnings

$35.2 million

$4.1 million

 

 

Non-GAAP Adjusted EBITDA(1)

$71.1 million

$30.1 million

 

 

Operating Cash Flow

$(38.3) million

$(37.1) million

 

 

Free Cash Flow (1)(2)

$(46.3) million

$(44.0) million

 

 

(1) Non-GAAP Adjusted EBITDA (“Adjusted EBITDA”) and Free Cash Flow are non-GAAP financial measures that exclude the impact of certain items noted in the reconciliation tables below. The tables below provide reconciliations to the most comparable GAAP measures.

(2) Defined as operating cash flow less capital expenditures.

First-quarter 2021 financial highlights:

Net sales of $245.3 million, up $24.6 million, or 11.1%, from the first quarter of 2020, driven by continued strength in capital markets and growth in software solutions sales, partially offset by lower print volume as a result of SEC Rule 30e-3.
Record quarterly software solutions net sales of $60.3 million, up 27.5% from the first quarter of 2020; software solutions net sales accounted for 24.6% of total first-quarter 2021 net sales, up from 21.4% in the first quarter of 2020.
Actions to mitigate the impact of SEC Rules 30e-3 and 498A are on plan; first-quarter 2021 gross margin for print and distribution was 32.6%, an improvement of 770 basis points from the first quarter of 2020, despite a decline in print and distribution sales of $25.0 million, or 27.3%, from the first quarter of 2020.
Net earnings of $35.2 million, up $31.1 million from the first quarter of 2020, primarily driven by a favorable sales mix, operating leverage on sales growth and cost control initiatives, partially offset by the LSC multiemployer pension plans obligation charge, higher incentive compensation and selling expenses.
Adjusted EBITDA of $71.1 million, up 136.2% from the first quarter of 2020, and Adjusted EBITDA margin of 29.0%, more than double the first-quarter 2020 Adjusted EBITDA margin; the significant improvements in both Adjusted EBITDA and Adjusted EBITDA margin were primarily driven by a favorable sales mix, operating leverage on sales growth and cost control initiatives, partially offset by higher incentive compensation and selling expenses.
Non-GAAP gross leverage of 1.2x and non-GAAP net leverage of 1.0x as of March 31, 2021; down 1.1x and 1.3x, respectively, from March 31, 2020.
During the first quarter, the Company repurchased 126,682 shares in open market transactions for $3.4 million at an average price of $26.92 per share. As of March 31, 2021, the remaining repurchase authorization was approximately $46.7 million.

 

“We are pleased with the excellent performance to begin the year, highlighted by nearly 28% growth in our software solutions sales versus the first quarter of 2020; more than 136% growth in Adjusted EBITDA versus the first quarter of 2020; and Adjusted EBITDA margin of 29.0%, more than double the margin we achieved in the first quarter of 2020. In addition, we are encouraged by client adoption of our new recurring software products. ArcDigital, which we launched last May, is off to a strong start in 2021, and our next-generation, built-from-the-ground-up ActiveDisclosure platform, which we launched in the first quarter, will begin contributing to our software solutions sales in the second quarter, as we convert clients from ActiveDisclosure 3.0 and onboard new clients,” said Daniel N. Leib, DFIN’s president and chief executive officer.

 

Leib continued, “The momentum of the transactional activity, including demand for our Venue data room, within equity capital markets that began to build in the second half of 2020 accelerated in the first quarter, as did our shift in business mix, growing our software solutions and tech-enabled services sales, and reducing our sales derived from print and distribution. Excluding print and distribution, our net sales grew over 38% in the quarter.”

 


 

“The momentum in the equity capital markets has, so far, continued into the second quarter, and given our market leadership, we are well positioned to benefit from this momentum. Importantly, we remain focused on investing in our software products and growing our software solutions sales in support of our “44 in ‘24” strategy, which we believe will translate into significant and sustainable value for our shareholders,” Leib concluded.

Net Sales

Net sales in the first quarter of 2021 were $245.3 million, an increase of $24.6 million, or 11.1%, from the first quarter of 2020. Net sales increased primarily due to higher capital markets transactional activity and software solutions net sales growth, partially offset by lower print volume as a result of SEC Rule 30e-3 eliminating print requirements.

Net Earnings

For the first quarter of 2021, net earnings were $35.2 million, or $1.02 per diluted share, as compared to net earnings of $4.1 million, or $0.12 per diluted share, in the first quarter of 2020. Net earnings in the first quarter of 2021 included after-tax charges of $4.6 million, or $0.13 per diluted share, primarily related to estimated multiemployer pension plans obligation arising from the bankruptcy of LSC Communications, Inc. Net earnings in the first quarter of 2020 included after-tax losses of $4.6 million, or $0.13 per diluted share, related to restructuring and share-based compensation expense and an after-tax gain of $1.7 million, or $0.05 per diluted share, related to the extinguishment of debt.

Adjusted EBITDA and Non-GAAP Net Earnings

For the first quarter of 2021, Adjusted EBITDA was $71.1 million, an increase of $41.0 million, or 136.2% as compared to the first quarter of 2020. For the first quarter of 2021, Adjusted EBITDA margin was 29.0%, an improvement of approximately 1,540 basis points versus the first quarter of 2020, primarily driven by a favorable sales mix, operating leverage on sales growth and cost control initiatives.

For the first quarter of 2021, non-GAAP net earnings were $39.8 million, or $1.15 per diluted share, compared to $7.2 million, or $0.21 per diluted share from the first quarter of 2020.

Reconciliations of net earnings to Adjusted EBITDA, non-GAAP net earnings and Adjusted EBITDA margin are presented in the attached schedules.

Regulatory Impacts

As previously disclosed in a Current Report on Form 8-K on July 22, 2020, the implementation of SEC Rule 30e-3 (elimination or reduction of print annual and semi-annual reports), Rule 498A (elimination or reduction of print summary prospectus) and the Company’s exiting of certain printing and distribution relationships is expected to reduce the Company’s print-related 2021 net sales by approximately $130 million to $140 million, and the associated reduction in net earnings and Adjusted EBITDA is expected to be approximately $4 million to $7 million and approximately $5 million to $10 million, respectively, in 2021. The Company reaffirms these estimates at this time.

Conference Call Details

DFIN will hold a conference call and webcast on May 5, 2021 at 9:00 a.m. Eastern time to discuss financial results for the first-quarter 2021, provide a general business update and respond to analyst questions.

 

A live webcast of the call will also be available on the Company’s investor relations website. Please visit investor.dfinsolutions.com at least fifteen minutes prior to the start of the event to register, download and install any necessary audio software.

 

If you are unable to participate live, a replay of the webcast will be available following the conference call on the Company’s investor relations website, along with the earnings press release, and related financial tables.

2

 


 

About DFIN

 

DFIN is a leading global risk and compliance solutions company. We provide domain expertise, enterprise software and data analytics for every stage of our clients’ business and investment lifecycles. Markets fluctuate, regulations evolve, technology advances, and through it all, DFIN delivers confidence with the right solutions in moments that matter. Learn about DFIN’s end-to-end risk and compliance solutions online at DFINsolutions.com or you can also follow us on Twitter @DFINSolutions or on LinkedIn.

Investor Contact:

Dave Gardella

Chief Financial Officer

investors@dfinsolutions.com

Use of non-GAAP Information

This news release contains certain non-GAAP financial measures, including non-GAAP gross profit, selling, general, and administrative expenses (“SG&A”), non-GAAP income from operations, non-GAAP operating margin, Adjusted EBITDA, Adjusted EBITDA margin, non-GAAP effective tax rate, non-GAAP net earnings, non-GAAP diluted earnings per share, Free Cash Flow and organic net sales. The Company believes that these non-GAAP financial measures, when presented in conjunction with comparable GAAP measures, provide useful information about the Company’s operating results and liquidity and enhance the overall ability to assess the Company’s financial performance. The Company uses these measures, together with other measures of performance under GAAP, to compare the relative performance of operations in planning, budgeting and reviewing the performance of its business.

The Company’s non-GAAP statement of operations measures, which include non-GAAP gross profit, SG&A, non-GAAP SG&A as % of total net sales, non-GAAP income from operations, non-GAAP operating margin, Adjusted EBITDA, Adjusted EBITDA margin, non-GAAP effective tax rate, non-GAAP net earnings and non-GAAP diluted earnings per share, are adjusted to exclude the impact of certain costs, expenses, gains and losses and other specified items that management believes are not indicative of our ongoing operations. These adjusted measures exclude the impact of expenses associated with the Company’s COVID-19 related recoveries and expenses, LSC multiemployer pension plans obligation, pension settlement charges, non-income tax charges, accelerated rent expense, share-based compensation and eliminate potential differences in results of operations between periods caused by factors such as historic cost and age of assets, financing and capital structures, taxation positions or regimes, restructuring, impairment and other charges and gain or loss on certain equity investments and asset sales.

Free Cash Flow is a non-GAAP financial measure and is defined by the Company as net cash flow provided by operating activities less capital expenditures. By adjusting for the level of capital investment in operations, the Company believes that free cash flow can provide useful additional basis for understanding the Company’s ability to generate cash after capital investment and provides a comparison to peers with differing capital intensity.

Organic net sales is a non-GAAP financial measure and is defined by the Company as reported net sales adjusted for the changes in foreign exchange rates.

These non-GAAP financial measures should be considered in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. In addition, these measures are defined differently by different companies in our industry and, accordingly, such measures may not be comparable to similarly-titled measures of other companies.

3

 


 

Use of Forward-Looking Statements

This news release includes certain "forward-looking statements" within the meaning of, and subject to the safe harbor created by, Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the business, strategy and plans of DFIN and its expectations relating to future financial condition and performance. Statements that are not historical facts, including statements about DFIN management’s beliefs and expectations, are forward-looking statements. Words such as "believes," "anticipates," "estimates," "expects," "intends," "aims," "potential," "will," "would," "could," "considered," "likely," "estimate" and variations of these words and similar future or conditional expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. While DFIN believes these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond DFIN’s control. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend upon future circumstances that may or may not occur. Actual results may differ materially from DFIN’s current expectations depending upon a number of factors affecting the business and risks associated with the performance of the business. These factors include such risks and uncertainties detailed in DFIN periodic public filings with the SEC, including but not limited to those discussed under "Risk Factors" in DFIN's Form 10-K for the fiscal year ended December 31, 2020, those discussed under “Cautionary Statement” in DFIN’s quarterly Form 10-Q filings, and in other investor communications of DFIN’s from time to time. DFIN does not undertake to and specifically declines any obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect future events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.

4

 


 

Donnelley Financial Solutions, Inc. and Subsidiaries ("DFIN")

Condensed Consolidated Balance Sheets

(UNAUDITED)

(in millions, except per share data)

March 31, 2021

December 31, 2020

Assets

Cash and cash equivalents

$

38.5

$

73.6

Receivables, less allowances for expected losses of $12.6 in 2021 (2020 - $10.5)

235.3

173.5

Inventories

6.5

4.9

Prepaid expenses and other current assets

22.8

9.7

Assets held for sale

5.5

5.5

Total current assets

308.6

267.2

Property, plant and equipment, net

12.3

12.0

Right-of-use assets

48.6

52.5

Software, net

50.9

51.2

Goodwill

410.0

409.9

Other intangible assets, net

9.6

9.8

Deferred income taxes, net

30.5

34.0

Other noncurrent assets

29.6

29.0

Total assets

$

900.1

$

865.6

Liabilities

Accounts payable

$

59.8

$

54.2

Accrued liabilities

181.0

184.3

Total current liabilities

240.8

238.5

Long-term debt

252.7

230.5

Deferred compensation liabilities

20.0

20.8

Pension and other postretirement benefits plan liabilities

48.7

51.0

Noncurrent lease liabilities

46.6

51.0

Other noncurrent liabilities

15.3

26.0

Total liabilities

624.1

617.8

Equity

Preferred stock, $0.01 par value

Authorized: 1.0 shares; Issued: None

Common stock, $0.01 par value

Authorized: 65.0 shares;

Issued and outstanding: 35.6 shares and 33.6 shares in 2021 (2020 - 34.9 shares and 33.3 shares)

0.4

0.3

Treasury stock, at cost: 2.0 shares in 2021 (2020 - 1.6 shares)

(27.7

)

(16.0

)

Additional paid-in capital

241.9

238.8

Retained earnings

140.7

105.5

Accumulated other comprehensive loss

(79.3

)

(80.8

)

Total equity

276.0

247.8

Total liabilities and equity

$

900.1

$

865.6

 

5

 


 

Donnelley Financial Solutions, Inc. and Subsidiaries ("DFIN")

Condensed Consolidated Statements of Operations

(UNAUDITED)

(in millions, except per share data)

Three Months Ended March 31,

2021

2020

Net sales

Tech-enabled services

$

118.5

$

81.9

Software solutions

60.3

47.3

Print and distribution

66.5

91.5

Total net sales

245.3

220.7

Cost of sales (1)

Tech-enabled services

41.0

42.8

Software solutions

24.5

24.8

Print and distribution

44.8

68.7

Total cost of sales

110.3

136.3

Selling, general and administrative expenses (1)

73.5

57.0

Depreciation and amortization

9.8

12.4

Restructuring, impairment and other charges, net

0.8

3.1

Income from operations

50.9

11.9

Interest expense, net

5.3

4.6

Investment and other income, net

(0.8

)

(0.4

)

Earnings before income taxes

46.4

7.7

Income tax expense

11.2

3.6

Net earnings

$

35.2

$

4.1

Net earnings per share:

Basic

$

1.05

$

0.12

Diluted

$

1.02

$

0.12

Weighted average number of common shares outstanding:

Basic

33.6

34.2

Diluted

34.5

34.3

Additional information:

Gross margin (1)

55.0

%

38.2

%

SG&A as a % of total net sales (1)

30.0

%

25.8

%

Operating margin

20.8

%

5.4

%

Effective tax rate

24.1

%

46.8

%

__________

(1) Exclusive of depreciation and amortization

6

 


 

Donnelley Financial Solutions, Inc. and Subsidiaries ("DFIN")

Reconciliation of GAAP to Non-GAAP Measures

For the Three Months Ended March 31, 2021 and 2020

(UNAUDITED)

(in millions, except per share data)

For the Three Months Ended March 31, 2021

Gross profit

SG&A

Income (loss)

from

operations

Operating

margin

Net

earnings (loss)

Net

earnings (loss)

per diluted

share (1)

GAAP basis measures

$

135.0

$

73.5

$

50.9

20.8

%

$

35.2

$

1.02

Non-GAAP adjustments:

Restructuring, impairment and other charges, net

0.8

0.3

%

0.6

0.02

Share-based compensation expense

(3.1

)

3.1

1.3

%

(0.7

)

(0.02

)

LSC multiemployer pension plans obligation

(7.3

)

7.3

3.0

%

5.2

0.15

Non-income tax expense

(0.1

)

0.1

0.0

%

0.1

COVID-19 related (recoveries) expenses, net

(0.9

)

(0.9

)

(0.4

%)

(0.7

)

(0.02

)

Loss on equity investment

0.1

Total Non-GAAP adjustments

(0.9

)

(10.5

)

10.4

4.2

%

4.6

0.13

Non-GAAP measures

$

134.1

$

63.0

$

61.3

25.0

%

$

39.8

$

1.15

For the Three Months Ended March 31, 2020

Gross profit

SG&A

Income (loss)

from

operations

Operating

margin

Net

earnings (loss)

Net

earnings (loss)

per diluted

share (1)

GAAP basis measures

$

84.4

$

57.0

$

11.9

5.4

%

$

4.1

$

0.12

Non-GAAP adjustments:

Restructuring, impairment and other charges, net

3.1

1.4

%

2.2

0.06

Share-based compensation expense

(2.3

)

2.3

1.0

%

2.4

0.07

Gain on debt extinguishment (2)

(1.7

)

(0.05

)

COVID-19 related (recoveries) expenses, net

0.8

0.4

%

0.6

0.02

eBrevia contingent consideration

0.4

(0.4

)

(0.2

%)

(0.4

)

(0.01

)

Total Non-GAAP adjustments

(1.9

)

5.8

2.6

%

3.1

0.09

Non-GAAP measures

$

84.4

$

55.1

$

17.7

8.0

%

$

7.2

$

0.21

__________

(1) Net earnings (loss) per diluted share totals may not foot due to rounding.

(2) Gain on debt extinguishment is recorded within interest expense, net in the Company’s Unaudited Condensed Consolidated Statements of Operations.

 

The Company believes that certain non-GAAP financial measures, when presented in conjunction with comparable GAAP measures, are useful because that information is an appropriate measure for evaluating the Company’s operating performance. Internally, the Company uses this non-GAAP information as an indicator of business performance, and evaluates management’s effectiveness with specific reference to this indicator. These measures should be considered in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.

7

 


 

Donnelley Financial Solutions, Inc. and Subsidiaries ("DFIN")

Segment GAAP to Non-GAAP Reconciliation and Supplementary Information

For the Three Months Ended March 31, 2021 and 2020

(UNAUDITED)

(in millions)

Capital Markets - Software Solutions

Capital Markets - Compliance and Communications Management

Investment Companies - Software Solutions

Investment Companies - Compliance and Communications Management

Corporate

Consolidated

For the Three Months Ended March 31, 2021

Net sales

$

38.5

$

138.5

$

21.8

$

46.5

$

$

245.3

Income (loss) from operations

6.5

59.1

2.0

6.3

(23.0

)

50.9

Operating margin %

16.9

%

42.7

%

9.2

%

13.5

%

nm

20.8

%

Non-GAAP Adjustments

Restructuring, impairment and other charges, net

0.7

0.1

0.8

Share-based compensation expense

3.1

3.1

LSC multiemployer pension plans obligation

7.3

7.3

Non-income tax expense

0.1

0.1

COVID-19 related (recoveries) expenses, net

(0.2

)

(0.7

)

(0.9

)

Total Non-GAAP adjustments

0.1

(0.2

)

10.5

10.4

Non-GAAP income (loss) from operations

$

6.6

$

58.9

$

2.0

$

6.3

$

(12.5

)

$

61.3

Non-GAAP operating margin %

17.1

%

42.5

%

9.2

%

13.5

%

nm

25.0

%

Depreciation and amortization

3.7

1.5

3.6

1.0

9.8

Adjusted EBITDA

$

10.3

$

60.4

$

5.6

$

7.3

$

(12.5

)

$

71.1

Adjusted EBITDA margin %

26.8

%

43.6

%

25.7

%

15.7

%

nm

29.0

%

Capital expenditures

$

3.7

$

0.6

$

1.8

$

0.5

$

1.4

$

8.0

For the Three Months Ended March 31, 2020

Net sales

$

31.2

$

99.1

$

16.1

$

74.3

$

$

220.7

Income (loss) from operations

1.8

21.4

0.1

2.1

(13.5

)

11.9

Operating margin %

5.8

%

21.6

%

0.6

%

2.8

%

nm

5.4

%

Non-GAAP Adjustments

Restructuring, impairment and other charges, net

0.3

0.5

0.3

0.4

1.6

3.1

Share-based compensation expense

2.3

2.3

COVID-19 related (recoveries) expenses, net

0.3

0.5

0.8

eBrevia contingent consideration

(0.4

)

(0.4

)

Total Non-GAAP adjustments

0.3

0.8

0.3

0.9

3.5

5.8

Non-GAAP income (loss) from operations

$

2.1

$

22.2

$

0.4

$

3.0

$

(10.0

)

$

17.7

Non-GAAP operating margin %

6.7

%

22.4

%

2.5

%

4.0

%

nm

8.0

%

Depreciation and amortization

3.1

4.0

2.9

2.4

12.4

Adjusted EBITDA

$

5.2

$

26.2

$

3.3

$

5.4

$

(10.0

)

$

30.1

Adjusted EBITDA margin %

16.7

%

26.4

%

20.5

%

7.3

%

nm

13.6

%

Capital expenditures

$

3.3

$

0.2

$

2.8

$

$

0.6

$

6.9

__________

nm - Not meaningful

8

 


 

Donnelley Financial Solutions, Inc. and Subsidiaries ("DFIN")

Condensed Consolidated Statements of Cash Flows

(UNAUDITED)

(in millions)

For the Three Months Ended March 31,

2021

2020

Operating Activities

Net earnings

$

35.2

$

4.1

Adjustments to reconcile net earnings to net cash used in operating activities:

Depreciation and amortization

9.8

12.4

Provision for expected losses on accounts receivable

1.1

1.6

Share-based compensation

3.1