Donnelley (R.R.) & Sons Co. (NYSE:RRD.WI)
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Highlights: -- First-Quarter GAAP net earnings from continuing operations of $114.2 million or $0.52 per diluted share -- First-Quarter Non-GAAP net earnings from continuing operations of $124.4 million or $0.57 per diluted share -- Reaffirms full-year, 2006 Non-GAAP net earnings per diluted share from continuing operations guidance of $2.45 to $2.50
CHICAGO, May 2 /PRNewswire-FirstCall/ -- R.R. Donnelley & Sons Company (NYSE:RRD) today reported first-quarter 2006 net earnings from continuing operations of $114.2 million or $0.52 per diluted share on net sales of $2.3 billion compared to net earnings from continuing operations of $109.2 million or $0.50 per diluted share on net sales of $1.9 billion in the first quarter of 2005. The first-quarter 2006 net earnings from continuing operations included charges for restructuring ($16.2 million) and impairment ($0.4 million) totaling $16.6 million, substantially all associated with the reorganization of certain operations and the exiting of certain business activities. Net earnings from continuing operations in the first quarter of 2005 included charges for restructuring ($10.9 million), impairment ($1.3 million) and integration ($2.5 million) totaling $14.7 million, primarily related to the integration of the 2004 acquisition of Moore Wallace. The company's effective tax rate decreased to 35.5% in the first quarter of 2006 from 37.9% in the first quarter of 2005, primarily reflecting the benefit from a larger proportion of taxable income being generated in lower tax jurisdictions. The company recorded a net loss from discontinued operations of $2.3 million in both the first quarter of 2006 and the first quarter of 2005. Including discontinued operations, net earnings were $111.9 million or $0.51 per diluted share in the first quarter of 2006 compared to net earnings of $106.9 million or $0.49 per diluted share in the first quarter of 2005.
The company believes that certain non-GAAP measures, when presented in conjunction with comparable GAAP (Generally Accepted Accounting Principles) 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 these indicators. These measures should be considered in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.
Non-GAAP net earnings from continuing operations totaled $124.4 million or $0.57 per diluted share in the first quarter of 2006 compared to $117.6 million or $0.54 per diluted share in the first quarter of 2005. Non-GAAP net earnings from continuing operations exclude restructuring, impairment and integration charges in the first quarters of both 2006 and 2005. A reconciliation of GAAP net earnings to non-GAAP net earnings for these adjustments is presented in the attached tables.
"Strong sales growth across our platform, led by our Integrated Print Communications and Publishing and Retail Services segments, and continued cost discipline, generated our strong results during the first quarter," said Mark A. Angelson, RR Donnelley's Chief Executive Officer. "Previously announced client contract wins and renewals continue to impact our results and we are pleased that our momentum continued during the quarter."
Angelson added, "In addition to the top-line growth in our existing operations, we supplemented our platform through the acquisition of OfficeTiger, which was completed last week, further to build on the business process outsourcing strengths added by last year's acquisition of the Astron Group. Our strength in business process outsourcing, in conjunction with our premedia and logistics capabilities, provides us with an unparalleled service offering that is increasingly important to our customers."
Business Review (Continuing Operations)
Following are the results for the company and each reportable segment.
Summary
Net sales in the quarter were $2.3 billion, up 17.7% from the first quarter of 2005. The increase was primarily due to acquisitions, namely the Astron Group, Asia Printers Group, Poligrafia, Spencer Press, the Charlestown, Indiana print operations of Adplex-Rhodes and Critical Mail Continuity Services, and new customer wins and increased volume with existing customers in the Integrated Print Communications and Publishing and Retail Services segments, offset in part by continued pricing pressure. The gross margin rate decreased to 26.7% in the first quarter of 2006 from 29.0% in the first quarter of 2005, reflecting a difference in the allocation of certain expenses between cost of sales and selling, general and administrative (SG&A) expense, and pricing pressure, higher energy prices, a shift in business mix and higher year-over-year paper prices, offset in part by benefits from cost reduction actions and procurement savings. SG&A expense as a percentage of net sales decreased to 11.6% in the first quarter of 2006 from 13.1% in the first quarter of 2005, reflecting in part a difference in the allocation of certain expenses between cost of sales and SG&A expense. SG&A expense in the first quarter of 2005 benefited from a $7.8 million expense reversal related to a value-added tax refund and collection of a bankruptcy receivable that was previously written off. Operating margin decreased to 9.3% in the first quarter of 2006 from 10.2% in the first quarter a year earlier.
Excluding restructuring, impairment and integration charges of $16.6 million in the first quarter of 2006 and $14.7 million in the first quarter of 2005, the non-GAAP operating margin for the first quarter of 2006 was 10.1% compared to 11.0% for the first quarter of 2005, primarily related to the $7.8 million favorable expense reversal in the first quarter of 2005 related to a value-added tax refund and collection of a bankruptcy receivable that was previously written off, pricing pressure, a shift in business mix, higher energy prices and higher paper prices. Reconciliations of GAAP operating income and margin to non-GAAP operating income and margin are presented in the attached tables.
Segments
The company reports its results in four reportable segments: 1) Publishing and Retail Services, 2) Integrated Print Communications, 3) Forms and Labels and 4) Corporate.
The Publishing and Retail Services segment includes: our 1) magazine, catalog and retail, 2) directories, 3) book, 4) Europe, 5) Asia, 6) logistics and 7) premedia businesses. Net sales for the Publishing and Retail Services segment increased 13.4% to $1.1 billion from the first quarter of 2005 primarily due to sales increases from all businesses within the segment and the acquisitions of the Asia Printers Group, Spencer Press, the Charlestown, Indiana print operations of Adplex-Rhodes and Poligrafia. The segment's operating margin, which was negatively impacted by restructuring and integration charges of $6.6 million and $1.8 million in the first quarters of 2006 and 2005, respectively, was 13.5% in the first quarter of 2006 compared to 15.5% in the first quarter of 2005. Operating margin benefited, in the first quarter of 2005, from the $7.8 million favorable expense reversal related to a value-added tax refund and collection of a bankruptcy receivable that was previously written off.
Excluding restructuring and integration charges, the segment's non-GAAP operating margin for the first quarter of 2006 was 14.1% compared to 15.7% in the first quarter of 2005, primarily related to the $7.8 million favorable expense reversal in the first quarter of 2005 related to a value-added tax refund and collection of a bankruptcy receivable that was previously written off and higher energy prices. While higher paper prices decreased operating margin percentages slightly, they had no material impact on operating income, as price increases largely were passed directly through to customers. Productivity improvements more than offset pricing pressure.
The Integrated Print Communications segment includes: our 1) direct mail and business communications services, 2) financial print, 3) short-run commercial print, and 4) the Astron Group businesses. Net sales for the Integrated Print Communications segment increased 36.7% to $727.3 million from the first quarter of 2005, primarily due to the acquisition of the Astron Group as well as sales growth in our financial print, short-run commercial print and direct mail and business communication services businesses. The segment's operating margin, which was negatively impacted by restructuring, impairment and integration charges of $3.0 million and $4.5 million in the first quarters of 2006 and 2005, respectively, decreased to 10.5% in the first quarter of 2006 from 12.1% in the first quarter of 2005. Excluding restructuring, impairment and integration charges, the segment's non-GAAP operating margin decreased to 10.9% in the first quarter of 2006 from 13.0% in the first quarter of 2005. This decrease was due to mix shift to lower margin businesses and incremental non-cash depreciation and purchase accounting- related amortization expenses associated with the acquisition of the Astron Group.
The Forms and Labels segment includes: our 1) forms, 2) labels, 3) office products, 4) Latin America and 5) Canada businesses. Net sales for the segment increased 3.3% to $425.9 million in the first quarter of 2006 from the first quarter of 2005, primarily due to favorable foreign exchange rates and increased volume in our Latin America and Canada businesses. The segment's operating margin, which was negatively impacted by restructuring, impairment and integration charges of $1.0 million and $4.2 million in the first quarters of 2006 and 2005, respectively, increased to 7.9% in the first quarter of 2006 from 7.8% in the first quarter of 2005. Excluding restructuring, impairment and integration charges, non-GAAP operating margin decreased to 8.1% in the first quarter of 2006 from 8.8% in the first quarter of 2005, primarily due to continued pricing pressure, offset in part by increased sales volume and the benefits of our productivity efforts.
Corporate operating expenses decreased to $48.4 million in the first quarter of 2006 from $52.0 million in the first quarter of 2005. Excluding restructuring and integration charges of $6.0 million and $4.2 million in the first quarters of 2006 and 2005, respectively, corporate operating expenses decreased $5.4 million to $42.4 million from the first quarter of the prior year primarily due to lower employee-related costs, offset in part by additional investment in information technology.
Outlook -- 2006 Full-Year Non-GAAP EPS from Continuing Operations Reaffirmed
For the full year of 2006, RR Donnelley is projecting non-GAAP net earnings per diluted share from continuing operations to be in the range of $2.45 to $2.50. This guidance includes the expected dilutive impact from both the acquisition of OfficeTiger and the adoption of SFAS 123 (R) - Share-Based Payment, but assumes no shares repurchased under the authorization available to the company. The non-GAAP effective tax rate for 2006 is expected to be approximately 35.5%.
GAAP net earnings per diluted share from continuing operations, in 2006, may include restructuring, impairment and integration charges, the resolution of certain tax items and other items that are not currently determinable, but may be significant. For that reason, the company is unable to provide GAAP net earnings estimates at this time.
Conference Call
RR Donnelley will host a conference call to discuss its first quarter results on Tuesday, May 2, 2006, at 10:00 am Eastern Time (9:00 am Central Time). The company will provide a live webcast of the earnings conference call, which can be accessed via the Internet at http://www.rrdonnelley.com/ ("Investors"). Individuals wishing to participate can join the conference call by dialing (706) 634-1139. A webcast replay will be archived on the Company's web site for 30 days after the call. In addition, a telephonic replay of the call will be available for seven days at (706) 645-9291, passcode 8087444.
About RR Donnelley
RR Donnelley (NYSE:RRD) is the world's premier full-service provider of print and related services, including business process outsourcing. Founded more than 140 years ago, the company provides solutions in commercial printing, direct mail, financial printing, print fulfillment, forms and labels, logistics, call centers, transactional print-and-mail, print management, online services, digital photography, color services, and content and database management to customers in the publishing, healthcare, advertising, retail, technology, financial services and many other industries. The largest companies in the world and others rely on RR Donnelley's scale, scope and insight through a comprehensive range of online tools, variable printing services and market-specific solutions. For more information, visit the company's web site at http://www.rrd.com/ .
Use of Forward-Looking Statements
This news release contains "forward-looking statements" as defined in the U.S. Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements and any such forward-looking statements are qualified in their entirety by reference to the following cautionary statements. All forward-looking statements speak only as of the date of this news release and are based on current expectations and involve a number of assumptions, risks and uncertainties that could cause the actual results to differ materially from such forward-looking statements. The company 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. The factors that could cause material differences in the expected results of RR Donnelley include, without limitation, the following: the successful execution and integration of acquisitions and the performance of the Company's businesses following acquisitions; the ability to implement comprehensive plans for the execution of cross-selling, cost containment, asset rationalization and other key strategies; competitive pressures in all markets in which the company operates; factors that affect customer demand, including changes in postal rates and postal regulations, changes in the capital markets, changes in advertising markets, the rate of migration from paper- based forms to digital format, customers' budgetary constraints and customers' changes in short-range and long-range plans; and other risks and uncertainties described in RR Donnelley's periodic filings with the Securities and Exchange Commission (SEC). Readers are strongly encouraged to read the full cautionary statements contained in RR Donnelley's filings with the SEC. RR Donnelley disclaims any obligation to update or revise any forward-looking statements.
R. R. Donnelley and Sons Company
Consolidated Balance Sheets
As of March 31, 2006 and December 31, 2005
(UNAUDITED)
(In millions, except per share data)
At March 31, 2006 At December 31, 2005
Assets
Current Assets
Cash and cash equivalents $320.7 $366.7
Receivables, less allowance for
doubtful accounts 1,505.4 1,529.1
Inventories 506.5 481.4
Prepaid expenses and other current
assets 87.4 67.5
Deferred income taxes 167.0 177.0
Total Current Assets 2,587.0 2,621.7
Property, plant and equipment - net 2,138.8 2,138.6
Goodwill 2,753.1 2,750.7
Other intangible assets - net 1,093.5 1,094.3
Prepaid pension cost 514.3 514.1
Other noncurrent assets 295.7 254.3
Assets of discontinued operations - -
Total Assets $9,382.4 $9,373.7
Liabilities
Current Liabilities
Accounts payable 665.7 718.1
Accrued liabilities 829.6 826.9
Short-term debt 269.8 269.1
Total Current Liabilities 1,765.1 1,814.1
Long-term debt 2,351.5 2,365.4
Postretirement benefits 332.5 330.6
Deferred income taxes 589.3 596.8
Other noncurrent liabilities 559.0 541.2
Liabilities from discontinued
operations 4.1 1.4
Total Liabilities $5,601.5 $5,649.5
Shareholders' Equity
Preferred stock, $1.00 par value - -
Authorized shares: 2.0; Issued: None
Common stock, $1.25 par value
Authorized shares: 500.0 Issued shares:
243.0 in 2006 and 2005 303.7 303.7
Additional paid-in-capital 2,856.5 2,888.2
Retained earnings 1,495.1 1,439.4
Accumulated other comprehensive loss (95.4) (90.2)
Unearned compensation (11.4) (44.9)
Treasury stock, at cost, 25.5 shares
in 2006 (2005 -25.5 shares) (767.6) (772.0)
Total Shareholders' Equity $3,780.9 $3,724.2
Total Liabilities and Shareholders'
Equity $9,382.4 $9,373.7
R. R. Donnelley & Sons Company
Consolidated Statements of Operations
Three Months Ended March 31, 2006 and 2005
(In millions, except per share data)
(UNAUDITED)
Three months ending March 31,
ADJUSTMENTS ADJUSTMENTS
2006 TO NON- 2006 2005 TO NON- 2005
GAAP GAAP NON-GAAP GAAP GAAP NON-GAAP
Net sales $2,266.9 - $2,266.9 $1,926.5 - $1,926.5
Cost of sales
(exclusive of
depreciation and
amortization shown
below) 1,661.5 - 1,661.5 1,367.0 (0.1) 1,366.9
Selling, general
and administrative
expense (exclusive
of depreciation
and amortization
shown below) 262.1 - 262.1 251.5 (2.4) 249.1
Restructuring and
impairment charges
- net 16.6 (16.6) - 12.2 (12.2) -
Depreciation and
amortization 114.8 - 114.8 98.7 - 98.7
Total operating
expenses 2,055.0 (16.6) 2,038.4 1,729.4 (14.7) 1,714.7
Income from
continuing
operations 211.9 16.6 228.5 197.1 14.7 211.8
Interest expense -
net 34.8 - 34.8 21.1 - 21.1
Investment and
other income
(expense) - net (0.8) - (0.8) (0.6) - (0.6)
Earnings from continuing
operations before
income taxes and
minority interest 176.3 16.6 192.9 175.4 14.7 190.1
Income taxes 62.6 6.4 69.0 66.5 6.3 72.8
Minority interest (0.5) - (0.5) (0.3) - (0.3)
Net earnings from
continuing
operations 114.2 10.2 124.4 109.2 8.4 117.6
Income (loss) from
discontinued
operations - net
of tax (2.3) 2.3 - (2.3) 2.3 -
Net earnings $111.9 $12.5 $124.4 $106.9 $10.7 $117.6
Earnings per share:
Basic
Net earnings from
continuing
operations $0.53 $0.57 $0.51 $0.55
Loss from discontinued
operations, net of
tax (0.01) - (0.01) -
Net earnings $0.52 $0.57 $0.50 $0.55
Diluted
Net earnings from
continuing
operations $0.52 $0.57 $0.50 $0.54
Loss from discontinued
operations, net of
tax (0.01) - (0.01) -
Net earnings $0.51 $0.57 $0.49 $0.54
Weighted average
common shares
outstanding:
Basic 216.5 216.5 215.3 215.3
Diluted 217.8 217.8 217.0 217.0
The company believes that certain non-GAAP 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.
R.R. Donnelley & Sons Company
Reconciliation of GAAP to Non-GAAP Measures
IN MILLIONS, EXCEPT PER SHARE AMOUNTS
(UNAUDITED)
Three months ended March 31, 2006
Net
Income earnings
from per
continuing Operating Net diluted
operations margin earnings share
GAAP basis measures $211.9 9.4% $111.9 $0.51
Non-GAAP adjustments:
Restructuring and impairment
charges, net (1) 16.6 0.7% 10.2 0.05
Integration charges (2) - - - -
Income tax adjustments - -
Net loss from discontinued
operations (3) 2.3 0.01
Total non-GAAP adjustments 16.6 0.7% 12.5 0.06
Non-GAAP measures $228.5 10.1% $124.4 $0.57
Three months ended March 31, 2005
Net
Income earnings
from Net per
continuing Operating earnings diluted
operations margin (loss) share
GAAP basis measures $197.1 10.2% $106.9 $0.49
Non-GAAP adjustments:
Restructuring and impairment
charges, net (1) 12.2 0.6% 7.5 0.03
Integration charges (2) 2.5 0.2% 1.5 0.01
Income tax adjustments (0.6) -
Net loss from discontinued
operations (3) 2.3 0.01
Total non-GAAP adjustments 14.7 0.8% 10.7 0.05
Non-GAAP measures $211.8 11.0% $117.6 $0.54
(1) Restructuring and impairment: Operating results for the three months
ended March 31, 2006 and 2005 were affected by the following
restructuring and impairment charges:
- 2006 included $13.5 million for employee termination costs
substantially all of which were associated with restructuring
actions resulting from the reorganization of certain operations and
the exiting of certain business activities; $2.7 million of other
restructuring costs, primarily lease termination costs; and
$0.4 million for impairment of other long-lived assets.
- 2005 included $3.2 million for employee termination costs primarily
related to the elimination of duplicative administrative functions
resulting from the Moore Wallace acquisition and other actions to
restructure operations; $7.7 million of other restructuring costs,
primarily related to lease termination costs and relocation costs
associated with the Moore Wallace acquisition and the exiting of a
U.K. financial print facility, and $1.3 million of impairment of
long-lived assets primarily related to the abandonment of assets in
the Forms and Labels segment.
(2) Integration charges: Operating income included post-acquisition
integration charges of $2.5 million in the three months ended March
31, 2005 related to the Moore Wallace acquisition.
(3) Net loss from discontinued operations: Net loss from discontinued
operations in 2006 primarily reflects costs resulting from a subtenant
bankruptcy related to a facility previously occupied by the Company's
package logistics business. In 2005, the net loss from discontinued
operations primarily includes the results of the Peak Technologies
business.
R. R. Donnelley & Sons Company
Segment GAAP to Non-GAAP Operating Income and Margin Reconciliation
For the three months ended March 31, 2006 and 2005
$ IN MILLIONS
(UNAUDITED)
Integrated
Publishing Print Forms
and Retail Communic- and
Services ations Labels Corporate Consolidated
Three Months Ended
March 31, 2006 *
Net sales $1,113.7 $727.3 $425.9 $- $2,266.9
Operating expense 963.1 651.1 392.4 48.4 2,055.0
Operating income
(loss) 150.6 76.2 33.5 (48.4) 211.9
Operating margin % 13.5% 10.5% 7.9% nm 9.3%
Non-GAAP adjustments
Restructuring charges 6.6 2.6 1.0 6.0 16.2
Impairment charges - 0.4 - - 0.4
Integration charges - - - - -
Total non-GAAP
adjustments 6.6 3.0 1.0 6.0 16.6
Operating income (loss)
excluding restructuring,
impairment and
integration charges $157.2 $79.2 $34.5 $(42.4) $228.5
Operating margin excluding
restructuring, impairment
and integration
charges % 14.1% 10.9% 8.1% nm 10.1%
Depreciation and
amortization 59.0 33.3 14.6 7.9 114.8
Capital expenditures 65.6 17.8 4.2 3.3 90.9
Three Months Ended
March 31, 2005 *
Net sales $982.3 $532.0 $412.2 $- $1,926.5
Operating expense 829.8 467.5 380.1 52.0 1,729.4
Operating income (loss) 152.5 64.5 32.1 (52.0) 197.1
Operating margin % 15.5% 12.1% 7.8% nm 10.2%
Non-GAAP adjustments
Restructuring charges 1.3 4.3 2.6 2.7 10.9
Impairment charges - 0.1 1.2 - 1.3
Integration charges 0.5 0.1 0.4 1.5 2.5
Total non-GAAP
Adjustments 1.8 4.5 4.2 4.2 14.7
Operating income (loss)
excluding restructuring,
impairment and
integration
charges $154.3 $69.0 $36.3 $(47.8) $211.8
Operating margin
excluding restructuring,
impairment and
integration charges % 15.7% 13.0% 8.8% nm 11.0%
Depreciation and
amortization 51.6 23.5 16.1 7.5 98.7
Capital expenditures 78.2 5.8 5.1 4.7 93.8
* During the first quarter of 2006, management changed the Company's
reportable segments to better reflect the current organizational
structure. As a result, the Company's print fulfillment business is
reported in the Publishing and Retail Services segment (previously
reported in the Forms & Labels segment) and the Company's Canadian
outsourcing business (previously reported in the Integrated Print
Communications segment) and Canadian logistics business (previously
reported in the Publishing and Retail Services segment) are reported in
the Forms and Labels segment. All prior periods have been reclassified
to this current reporting structure.
The Company believes that certain non-GAAP 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.
R. R. Donnelley & Sons Company
Condensed Consolidated Statements of Cash Flows
For the three months ended March 31, 2006 and 2005
IN MILLIONS
(UNAUDITED)
2006 2005
Operating Activities
Net earnings $111.9 $106.9
Net (income) loss from discontinued
operations 2.3 2.3
Adjustment to reconcile net earnings (loss)
to cash provided by operating activities 150.4 141.4
Changes in operating assets and liabilities (155.0) (93.4)
Net cash provided by operating
activities of continuing operations 109.6 157.2
Net cash (used for) provided by operating
activities of discontinued operations (0.6) (3.3)
Net cash provided by operating activities 109.0 153.9
Net cash used for investing activities of
continuing operations (90.1) (84.8)
Net cash used for investing activities (90.1) (84.8)
Net cash used for financing activities of
continuing operations (65.8) (332.1)
Net cash used for financing activities (65.8) (332.1)
Effect of exchange rates on cash and cash
equivalents 0.9 (7.0)
Net decrease in cash and cash equivalents (46.0) (270.0)
Cash and cash equivalents at beginning of period 366.7 641.8
Cash and cash equivalents at end of period $320.7 $371.8
R.R. Donnelley & Sons Company
Revenue Reconciliation Reported to Pro Forma
For the three months ended March 31, 2006 and 2005
$ IN MILLIONS
(UNAUDITED)
Adjustment
for net
sales of
Reported net acquired Pro forma net
sales businesses sales
Three Months Ended March 31, 2006
Publishing and Retail Services $1,113.7 $- $1,113.7
Integrated Print Communications 727.3 - $727.3
Forms and Labels 425.9 - $425.9
Corporate - $-
Consolidated $2,266.9 $- $2,266.9
Three Months Ended March 31, 2005
Publishing and Retail Services $982.3 $57.2 $1,039.5
Integrated Print Communications 532.0 144.1 $676.1
Forms and Labels 412.2 $412.2
Corporate $-
Consolidated $1,926.5 $201.3 $2,127.8
Net sales change
Publishing and Retail Services 13.4% 7.1%
Integrated Print Communications 36.7% 7.6%
Forms and Labels 3.3% 3.3%
Corporate
Consolidated 17.7% 6.5%
The reported results of the company include the results of acquired
businesses from the acquisition date forward. The company has provided
this schedule to reconcile reported net sales for the three months ended
March 31, 2006 and 2005 to pro forma net sales as if the acquisitions
took place at the beginning of the respective periods.
Because no businesses were acquired in the quarter ended March 31, 2006,
no adjustment to reported net sales is included.
For the quarter ended March 31, 2005, the adjustment for net sales of
acquired businesses reflects the net sales of the Astron Group (acquired
June 20, 2005), Asia Printers Group (acquired July 7, 2005), the
Charlestown, Indiana print facility acquired from Adplex-Rhodes (acquired
August 18, 2005), Poligrafia (acquired September 5, 2005) and Spencer
Press (acquired November 9, 2005) for the three months ended March 31,
2005 as if the respective acquisitions had occurred on January 1, 2005.
DATASOURCE: R.R. Donnelley & Sons Company
CONTACT:
Web site: http://www.rrdonnelley.com/
http://www.rrd.com/