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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Veritiv Corporation | NYSE:VRTV | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 169.99 | 0 | 01:00:00 |
Delaware
|
|
46-3234977
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification Number)
|
|
|
|
1000 Abernathy Road NE
|
|
|
Building 400, Suite 1700
|
|
|
Atlanta, Georgia
|
|
30328
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Large accelerated filer
|
☐
|
Accelerated filer
|
☒
|
Non-accelerated filer
|
☐
(Do not check if a smaller reporting company)
|
Smaller reporting company
|
☐
|
|
|
Emerging growth company
|
☐
|
|
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Page
|
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||
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||
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||
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||
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||
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||
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Three Months Ended
March 31, |
||||||
|
2017
|
|
2016
|
||||
Net sales (including sales to related party of $8.9 and $9.0, respectively)
|
$
|
1,994.6
|
|
|
$
|
2,019.8
|
|
Cost of products sold (including purchases from related party of $47.1 and $56.3, respectively) (exclusive of depreciation and amortization shown separately below)
|
1,629.3
|
|
|
1,654.5
|
|
||
Distribution expenses
|
126.2
|
|
|
127.5
|
|
||
Selling and administrative expenses
|
211.6
|
|
|
200.9
|
|
||
Depreciation and amortization
|
13.1
|
|
|
13.5
|
|
||
Integration expenses
|
6.4
|
|
|
6.2
|
|
||
Restructuring charges
|
4.1
|
|
|
1.7
|
|
||
Operating income
|
3.9
|
|
|
15.5
|
|
||
Interest expense, net
|
6.4
|
|
|
6.5
|
|
||
Other expense, net
|
1.1
|
|
|
1.5
|
|
||
Income (loss) before income taxes
|
(3.6
|
)
|
|
7.5
|
|
||
Income tax expense (benefit)
|
(1.4
|
)
|
|
4.2
|
|
||
Net income (loss)
|
$
|
(2.2
|
)
|
|
$
|
3.3
|
|
|
|
|
|
||||
Earnings (loss) per share:
|
|
|
|
||||
Basic and diluted earnings (loss) per share
|
$
|
(0.14
|
)
|
|
$
|
0.21
|
|
|
|
|
|
||||
Weighted average shares outstanding:
|
|
|
|
||||
Basic and diluted
|
15.69
|
|
|
16.00
|
|
|
Three Months Ended
March 31, |
||||||
|
2017
|
|
2016
|
||||
Net income (loss)
|
$
|
(2.2
|
)
|
|
$
|
3.3
|
|
Other comprehensive income (loss):
|
|
|
|
||||
Foreign currency translation adjustments
|
2.8
|
|
|
3.8
|
|
||
Change in fair value of cash flow hedge, net of $0.0 and $0.1 tax, respectively
|
(0.1
|
)
|
|
(0.3
|
)
|
||
Pension liability adjustments, net of $0.0 and $0.1 tax, respectively
|
0.1
|
|
|
0.1
|
|
||
Other comprehensive income
|
2.8
|
|
|
3.6
|
|
||
Total comprehensive income
|
$
|
0.6
|
|
|
$
|
6.9
|
|
|
March 31, 2017
|
|
December 31, 2016
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash
|
$
|
52.4
|
|
|
$
|
69.6
|
|
Accounts receivable, less allowances of $34.7 and $34.5, respectively
|
1,038.6
|
|
|
1,048.3
|
|
||
Related party receivable
|
3.7
|
|
|
3.9
|
|
||
Inventories
|
725.2
|
|
|
707.9
|
|
||
Other current assets
|
120.8
|
|
|
118.9
|
|
||
Total current assets
|
1,940.7
|
|
|
1,948.6
|
|
||
Property and equipment (net of depreciation and amortization of $296.5 and $292.8, respectively)
|
371.2
|
|
|
371.8
|
|
||
Goodwill
|
50.2
|
|
|
50.2
|
|
||
Other intangibles, net
|
20.4
|
|
|
21.0
|
|
||
Deferred income tax assets
|
64.1
|
|
|
61.8
|
|
||
Other non-current assets
|
30.4
|
|
|
30.3
|
|
||
Total assets
|
$
|
2,477.0
|
|
|
$
|
2,483.7
|
|
Liabilities and shareholders' equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
604.3
|
|
|
$
|
654.1
|
|
Related party payable
|
10.1
|
|
|
9.0
|
|
||
Accrued payroll and benefits
|
67.7
|
|
|
84.4
|
|
||
Other accrued liabilities
|
95.8
|
|
|
102.5
|
|
||
Current maturities of long-term debt
|
2.6
|
|
|
2.9
|
|
||
Financing obligations to related party, current portion
|
14.9
|
|
|
14.9
|
|
||
Total current liabilities
|
795.4
|
|
|
867.8
|
|
||
Long-term debt, net of current maturities
|
825.7
|
|
|
749.2
|
|
||
Financing obligations to related party, less current portion
|
171.4
|
|
|
176.1
|
|
||
Defined benefit pension obligations
|
26.6
|
|
|
27.6
|
|
||
Other non-current liabilities
|
111.8
|
|
|
121.2
|
|
||
Total liabilities
|
1,930.9
|
|
|
1,941.9
|
|
||
Commitments and contingencies (Note 10)
|
|
|
|
|
|
||
Shareholders' equity:
|
|
|
|
||||
Preferred stock, $0.01 par value, 10.0 million shares authorized, none issued
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value, 100.0 million shares authorized, 16.0 million shares issued; shares outstanding - 15.7 million at March 31, 2017 and December 31, 2016 respectively
|
0.2
|
|
|
0.2
|
|
||
Additional paid-in capital
|
578.2
|
|
|
574.5
|
|
||
Accumulated earnings
|
17.5
|
|
|
19.7
|
|
||
Accumulated other comprehensive loss
|
(36.2
|
)
|
|
(39.0
|
)
|
||
Treasury stock at cost - 0.3 million shares at March 31, 2017 and December 31, 2016
|
(13.6
|
)
|
|
(13.6
|
)
|
||
Total shareholders' equity
|
546.1
|
|
|
541.8
|
|
||
Total liabilities and shareholders' equity
|
$
|
2,477.0
|
|
|
$
|
2,483.7
|
|
|
Three Months Ended March 31,
|
||||||
Operating Activities
|
2017
|
|
2016
|
||||
Net income (loss)
|
$
|
(2.2
|
)
|
|
$
|
3.3
|
|
Depreciation and amortization
|
13.1
|
|
|
13.5
|
|
||
Amortization of deferred financing fees
|
0.6
|
|
|
1.1
|
|
||
Net losses on dispositions of property and equipment
|
0.5
|
|
|
0.2
|
|
||
Long-lived asset impairment charges
|
0.7
|
|
|
0.4
|
|
||
Provision for allowance for doubtful accounts
|
0.6
|
|
|
(2.3
|
)
|
||
Deferred income tax provision (benefit)
|
(2.1
|
)
|
|
2.6
|
|
||
Stock-based compensation
|
3.7
|
|
|
2.0
|
|
||
Other non-cash items, net
|
(0.3
|
)
|
|
2.1
|
|
||
Changes in operating assets and liabilities
|
|
|
|
|
|
||
Accounts receivable and related party receivable
|
11.8
|
|
|
58.5
|
|
||
Inventories
|
(15.6
|
)
|
|
(2.8
|
)
|
||
Other current assets
|
(0.9
|
)
|
|
(6.3
|
)
|
||
Accounts payable and related party payable
|
(25.9
|
)
|
|
37.6
|
|
||
Accrued payroll and benefits
|
(16.9
|
)
|
|
(20.7
|
)
|
||
Other accrued liabilities
|
(5.5
|
)
|
|
(15.1
|
)
|
||
Other
|
(2.4
|
)
|
|
0.4
|
|
||
Net cash provided by (used for) operating activities
|
(40.8
|
)
|
|
74.5
|
|
||
Investing activities
|
|
|
|
||||
Property and equipment additions
|
(11.4
|
)
|
|
(8.9
|
)
|
||
Proceeds from asset sales
|
2.0
|
|
|
1.0
|
|
||
Net cash used for investing activities
|
(9.4
|
)
|
|
(7.9
|
)
|
||
Financing Activities
|
|
|
|
||||
Change in book overdrafts
|
(24.2
|
)
|
|
(15.4
|
)
|
||
Borrowings of long-term debt
|
1,200.9
|
|
|
1,122.0
|
|
||
Repayments of long-term debt
|
(1,131.3
|
)
|
|
(1,175.9
|
)
|
||
Payments under equipment capital lease obligations
|
(0.7
|
)
|
|
(1.0
|
)
|
||
Payments under financing obligations to related party
|
(3.6
|
)
|
|
(3.6
|
)
|
||
Payments under Tax Receivable Agreement
|
(8.5
|
)
|
|
—
|
|
||
Net cash provided by (used for) financing activities
|
32.6
|
|
|
(73.9
|
)
|
||
Effect of exchange rate changes on cash
|
0.4
|
|
|
0.6
|
|
||
Net change in cash
|
(17.2
|
)
|
|
(6.7
|
)
|
||
Cash at beginning of period
|
69.6
|
|
|
54.4
|
|
||
Cash at end of period
|
$
|
52.4
|
|
|
$
|
47.7
|
|
Supplemental cash flow information
|
|
|
|
|
|
||
Cash paid for income taxes, net of refunds
|
$
|
1.3
|
|
|
$
|
0.6
|
|
Cash paid for interest
|
5.6
|
|
|
5.2
|
|
||
Non-cash investing and financing activities
|
|
|
|
|
|
||
Non-cash additions to property and equipment
|
$
|
6.8
|
|
|
$
|
—
|
|
Recently Issued Accounting Standards Not Yet Adopted (continued)
|
|
|
|
|
||
Standard
|
|
Description
|
|
Effective Date
|
|
Effect on the Financial Statements or Other Significant Matters
|
ASU 2016-15,
Statement of Cash
Flows (Topic 230)
|
|
The standard addresses eight specific cash flow issues and is intended to reduce diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The guidance requires application on a retrospective basis.
|
|
January 1, 2018; early adoption is permitted (early adoption requires the adoption of all amendments in the same period)
|
|
The Company is currently evaluating the impact this ASU will have on its Consolidated Financial Statements and related disclosures. The Company will adopt this ASU on January 1, 2018.
|
ASU 2017-01,
Business Combinations (Topic 805)
|
|
The standard clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The guidance requires application on a prospective basis.
|
|
January 1, 2018; early adoption is permitted
|
|
The Company will adopt this ASU on January 1, 2018.
|
ASU 2017-07,
Compensation-Retirement Benefits (Topic 715)
|
|
The standard requires employers to disaggregate the service cost component from the other components of net benefit cost and disclose the amount of net benefit cost that is included in the income statement or capitalized in assets, by line item. The standard requires employers to report the service cost component in the same line
item(s) as other compensation costs and to report other pension-related costs (which include interest costs, amortization of pension-related costs from prior periods and the gains or losses on plan assets) separately and exclude them from the subtotal of operating income. The standard also allows only the service cost component to be eligible for capitalization when applicable. The guidance requires application on a retrospective basis for the presentation of the service cost component and the other components of net periodic pension cost and net periodic postretirement benefit cost in the income statement and on a prospective basis for the capitalization of the service cost component of net periodic pension cost and net periodic postretirement benefit in assets.
|
|
January 1, 2018; early adoption is permitted as of the first interim period of an annual period for which interim or annual financial statements have not been issued
|
|
The Company is currently evaluating the impact this ASU will have on its Consolidated Financial Statements and related disclosures. The Company will adopt this ASU on January 1, 2018.
|
Recently Adopted Accounting Standards
|
|
|
|
|
||
Standard
|
|
Description
|
|
Effective Date
|
|
Effect on the Financial Statements or Other Significant Matters
|
ASU 2015-11,
Simplifying the Measurement of Inventory
|
|
The standard requires companies to measure inventory at the lower of cost and net realizable value, thereby simplifying the current guidance under which an entity must measure inventory at the lower of cost or market. This ASU will not apply to inventories measured by either the last-in first-out method or retail inventory method. The guidance requires application on a prospective basis.
|
|
January 1, 2017
|
|
The Company adopted this ASU on January 1, 2017. The adoption did not materially impact its Consolidated Financial Statements or related disclosures. For the three months ended March 31, 2017, approximately 87% of the inventory balance was measured using LIFO.
|
ASU 2017-04,
Intangibles - Goodwill and Other (Topic 350)
|
|
The standard simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The guidance requires application on a prospective basis.
|
|
January 1, 2020; early adoption is permitted
|
|
The Company adopted this ASU on January 1, 2017.
|
|
Three Months Ended
March 31, |
||||||
(in millions)
|
2017
|
|
2016
|
||||
Integration management
|
$
|
3.0
|
|
|
$
|
1.8
|
|
Retention compensation
|
0.1
|
|
|
1.1
|
|
||
Information technology conversion costs
|
1.8
|
|
|
1.1
|
|
||
Rebranding
|
0.1
|
|
|
0.7
|
|
||
Legal, consulting and other professional fees
|
0.4
|
|
|
0.5
|
|
||
Other
|
1.0
|
|
|
1.0
|
|
||
Total integration expenses
|
$
|
6.4
|
|
|
$
|
6.2
|
|
(in millions)
|
Severance and Related Costs
|
|
Other Direct Costs
|
|
Total
|
||||||
Balance at December 31, 2016
|
$
|
1.8
|
|
|
$
|
8.0
|
|
|
$
|
9.8
|
|
Costs incurred
|
1.4
|
|
|
3.1
|
|
|
4.5
|
|
|||
Payments
|
(1.2
|
)
|
|
(2.8
|
)
|
|
(4.0
|
)
|
|||
Balance at March 31, 2017
|
$
|
2.0
|
|
|
$
|
8.3
|
|
|
$
|
10.3
|
|
(in millions)
|
Severance and Related Costs
|
|
Other Direct Costs
|
|
Total
|
||||||
Balance at December 31, 2015
|
$
|
1.7
|
|
|
$
|
0.4
|
|
|
$
|
2.1
|
|
Costs incurred
|
0.7
|
|
|
0.3
|
|
|
1.0
|
|
|||
Payments
|
(0.9
|
)
|
|
(0.4
|
)
|
|
(1.3
|
)
|
|||
Balance at March 31, 2016
|
$
|
1.5
|
|
|
$
|
0.3
|
|
|
$
|
1.8
|
|
(in millions)
|
March 31, 2017
|
|
December 31, 2016
|
||||
Asset-Based Lending Facility (the "ABL Facility")
|
$
|
796.8
|
|
|
$
|
726.9
|
|
Equipment capital lease and other obligations
|
31.5
|
|
|
25.2
|
|
||
Total debt
|
828.3
|
|
|
752.1
|
|
||
Less: current portion of long-term debt
|
(2.6
|
)
|
|
(2.9
|
)
|
||
Long-term debt, net of current maturities
|
$
|
825.7
|
|
|
$
|
749.2
|
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2017
|
|
2016
|
||||
Income (loss) before income taxes
|
$
|
(3.6
|
)
|
|
$
|
7.5
|
|
Income tax expense (benefit)
|
$
|
(1.4
|
)
|
|
$
|
4.2
|
|
Effective tax rate
|
38.9
|
%
|
|
56.0
|
%
|
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
|
2017
|
|
2016
|
||||
Sales to Georgia-Pacific, reflected in net sales
|
|
$
|
8.9
|
|
|
$
|
9.0
|
|
Purchases of inventory from Georgia-Pacific, recognized in cost of products sold
|
|
$
|
47.1
|
|
|
$
|
56.3
|
|
(in millions)
|
|
March 31, 2017
|
|
December 31, 2016
|
||||
Inventories purchased from Georgia-Pacific that remained on Veritiv's balance sheet
|
|
$
|
24.0
|
|
|
$
|
24.8
|
|
Related party payable to Georgia-Pacific
|
|
$
|
10.1
|
|
|
$
|
9.0
|
|
Related party receivable from Georgia-Pacific
|
|
$
|
3.7
|
|
|
$
|
3.9
|
|
|
Three Months Ended March 31, 2017
|
|
Three Months Ended March 31, 2016
|
||||||||||||
(in millions)
|
U.S.
|
|
Canada
|
|
U.S.
|
|
Canada
|
||||||||
Components of net periodic benefit cost (credit):
|
|
|
|
|
|
|
|
||||||||
Service cost
|
$
|
0.5
|
|
|
$
|
0.1
|
|
|
$
|
0.4
|
|
|
$
|
0.1
|
|
Interest cost
|
0.7
|
|
|
0.7
|
|
|
0.9
|
|
|
0.8
|
|
||||
Expected return on plan assets
|
(1.3
|
)
|
|
(0.9
|
)
|
|
(1.3
|
)
|
|
(0.9
|
)
|
||||
Amortization of net loss
|
0.0
|
|
|
0.1
|
|
|
0.0
|
|
|
0.1
|
|
||||
Net periodic benefit cost (credit)
|
$
|
(0.1
|
)
|
|
$
|
0.0
|
|
|
$
|
0.0
|
|
|
$
|
0.1
|
|
|
|
|
|
|
|
|
|
(in millions)
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
ABL Facility
|
|
$
|
796.8
|
|
|
|
|
$
|
796.8
|
|
|
|
||
Tax Receivable Agreement
|
|
$
|
60.3
|
|
|
|
|
|
|
$
|
60.3
|
|
(in millions)
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
ABL Facility
|
|
$
|
726.9
|
|
|
|
|
$
|
726.9
|
|
|
|
||
Tax Receivable Agreement
|
|
$
|
67.9
|
|
|
|
|
|
|
$
|
67.9
|
|
(in millions)
|
|
Contingent Liability
|
||
Balance at December 31, 2016
|
|
$
|
67.9
|
|
Change in fair value adjustment recorded in other expense, net
|
|
0.9
|
|
|
Principal Payments
|
|
(8.5
|
)
|
|
Balance at March 31, 2017
|
|
$
|
60.3
|
|
(in millions)
|
|
Contingent Liability
|
||
Balance at December 31, 2015
|
|
$
|
63.0
|
|
Change in fair value adjustment recorded in other expense, net
|
|
1.8
|
|
|
Balance at March 31, 2016
|
|
$
|
64.8
|
|
|
Three Months Ended
March 31, |
||||||
(in millions, except per share data)
|
2017
|
|
2016
|
||||
Numerator:
|
|
|
|
||||
Net income (loss)
|
$
|
(2.2
|
)
|
|
$
|
3.3
|
|
|
|
|
|
||||
Denominator:
|
|
|
|
||||
Weighted average number of shares outstanding – basic and diluted
|
15.69
|
|
|
16.00
|
|
||
|
|
|
|
||||
Earnings (loss) per share:
|
|
|
|
||||
Basic and diluted earnings (loss) per share
|
$
|
(0.14
|
)
|
|
$
|
0.21
|
|
|
|
|
|
||||
Antidilutive stock-based awards excluded from computation of diluted earnings per share ("EPS")
|
0.47
|
|
|
0.15
|
|
||
Performance stock-based awards excluded from computation of diluted EPS because performance conditions had not been met
|
0.36
|
|
|
0.53
|
|
(in millions)
|
|
Foreign currency translation adjustments
|
|
Retirement liabilities
|
|
Interest rate swap
|
|
AOCL
|
||||||||
Balance at December 31, 2016
|
|
$
|
(29.2
|
)
|
|
$
|
(9.1
|
)
|
|
$
|
(0.7
|
)
|
|
$
|
(39.0
|
)
|
Unrealized net gains (losses) arising during the period
|
|
2.8
|
|
|
0.1
|
|
|
(0.1
|
)
|
|
2.8
|
|
||||
Net current period other comprehensive income (loss)
|
|
2.8
|
|
|
0.1
|
|
|
(0.1
|
)
|
|
2.8
|
|
||||
Balance at March 31, 2017
|
|
$
|
(26.4
|
)
|
|
$
|
(9.0
|
)
|
|
$
|
(0.8
|
)
|
|
$
|
(36.2
|
)
|
(in millions)
|
|
Foreign currency translation adjustments
|
|
Retirement liabilities
|
|
Interest rate swap
|
|
AOCL
|
||||||||
Balance at December 31, 2015
|
|
$
|
(27.1
|
)
|
|
$
|
(7.4
|
)
|
|
$
|
(0.5
|
)
|
|
$
|
(35.0
|
)
|
Unrealized net gains (losses) arising during the period
|
|
3.8
|
|
|
—
|
|
|
(0.3
|
)
|
|
3.5
|
|
||||
Amounts reclassified from AOCL
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
||||
Net current period other comprehensive income (loss)
|
|
3.8
|
|
|
0.1
|
|
|
(0.3
|
)
|
|
3.6
|
|
||||
Balance at March 31, 2016
|
|
$
|
(23.3
|
)
|
|
$
|
(7.3
|
)
|
|
$
|
(0.8
|
)
|
|
$
|
(31.4
|
)
|
(in millions)
|
Packaging
|
|
Facility Solutions
|
|
Print
|
|
Publishing
|
|
Total Reportable Segments
|
|
Corporate & Other
|
|
Total
|
||||||||||||||
Three Months Ended March 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net sales
|
$
|
721.8
|
|
|
$
|
306.8
|
|
|
$
|
698.7
|
|
|
$
|
234.0
|
|
|
$
|
1,961.3
|
|
|
$
|
33.3
|
|
|
$
|
1,994.6
|
|
Adjusted EBITDA
|
50.5
|
|
|
5.0
|
|
|
14.1
|
|
|
6.1
|
|
|
75.7
|
|
|
(45.9
|
)
|
|
|
|
|||||||
Depreciation and amortization
|
3.2
|
|
|
1.4
|
|
|
2.6
|
|
|
0.6
|
|
|
7.8
|
|
|
5.3
|
|
|
13.1
|
|
|||||||
Restructuring charges
|
1.6
|
|
|
0.4
|
|
|
1.9
|
|
|
0.0
|
|
|
3.9
|
|
|
0.2
|
|
|
4.1
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Three Months Ended March 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net sales
|
671.5
|
|
|
301.0
|
|
|
759.1
|
|
|
262.3
|
|
|
1,993.9
|
|
|
25.9
|
|
|
2,019.8
|
|
|||||||
Adjusted EBITDA
|
46.7
|
|
|
7.4
|
|
|
16.0
|
|
|
4.0
|
|
|
74.1
|
|
|
(39.2
|
)
|
|
|
|
|||||||
Depreciation and amortization
|
3.1
|
|
|
1.5
|
|
|
3.2
|
|
|
0.9
|
|
|
8.7
|
|
|
4.8
|
|
|
13.5
|
|
|||||||
Restructuring charges
|
0.3
|
|
|
0.3
|
|
|
0.9
|
|
|
0.0
|
|
|
1.5
|
|
|
0.2
|
|
|
1.7
|
|
|
Three Months Ended
March 31, |
||||||
(in millions)
|
2017
|
|
2016
|
||||
Income (loss) before income taxes
|
$
|
(3.6
|
)
|
|
$
|
7.5
|
|
Interest expense, net
|
6.4
|
|
|
6.5
|
|
||
Depreciation and amortization
|
13.1
|
|
|
13.5
|
|
||
Restructuring charges
|
4.1
|
|
|
1.7
|
|
||
Stock-based compensation
|
3.7
|
|
|
2.0
|
|
||
LIFO reserve decrease
|
(2.5
|
)
|
|
(5.3
|
)
|
||
Non-restructuring asset impairment charges
|
0.7
|
|
|
0.4
|
|
||
Non-restructuring severance charges
|
0.5
|
|
|
0.8
|
|
||
Integration expenses
|
6.4
|
|
|
6.2
|
|
||
Fair value adjustments on TRA contingent liability
|
0.9
|
|
|
1.8
|
|
||
Other
|
0.1
|
|
|
(0.2
|
)
|
||
Adjustment for Corporate and Other
|
45.9
|
|
|
$
|
39.2
|
|
|
Adjusted EBITDA for reportable segments
|
$
|
75.7
|
|
|
$
|
74.1
|
|
•
|
Packaging
– The Packaging segment provides standard as well as custom and comprehensive packaging solutions for customers based in North America and in key global markets. The business is strategically focused on higher growth industries including light industrial/general manufacturing, food production, fulfillment and internet retail, as well as niche verticals based on geographical and functional expertise. Veritiv’s packaging professionals create customer value through supply chain solutions, structural and graphic packaging design and engineering, automation, workflow and equipment services, contract packaging and kitting and fulfillment.
|
•
|
Facility Solutions
– The Facility Solutions segment sources and sells cleaning, break-room and other supplies such as towels, tissues, wipers and dispensers, can liners, commercial cleaning chemicals, soaps and sanitizers, sanitary maintenance supplies and equipment, safety and hazard supplies and shampoos and amenities primarily in the U.S., Canada and Mexico. Veritiv is a leading distributor in the Facility Solutions segment. Through this segment, Veritiv manages a world class network of leading suppliers in most facilities solutions categories. Additionally, the Company offers total cost of ownership solutions with re-merchandising, budgeting and compliance reporting, inventory management and a sales-force trained to bring leading vertical expertise to the major North American geographies.
|
•
|
Print
– The Print segment sells and distributes commercial printing, writing, copying, digital, wide format and specialty paper products, graphics consumables and graphics equipment primarily in the U.S., Canada and Mexico. This segment also includes customized paper conversion services of commercial printing paper for distribution to document centers and form printers. Veritiv's broad geographic platform of operations coupled with the breadth of paper and graphics products, including exclusive private brand offerings, provides a foundation to service national, regional and local customers across North America.
|
•
|
Publishing
– The Publishing segment sells and distributes coated and uncoated commercial printing papers to publishers, retailers, converters, printers and specialty businesses for use in magazines, catalogs, books, directories, gaming, couponing, retail inserts and direct mail. This segment also provides print management, procurement and supply chain management solutions to simplify paper and print procurement processes for Veritiv's customers.
|
|
Three Months Ended
March 31, |
|
Increase (Decrease)
|
|||||||||||
(in millions)
|
2017
|
|
2016
|
|
$
|
|
%
|
|||||||
Net sales
|
$
|
1,994.6
|
|
|
$
|
2,019.8
|
|
|
$
|
(25.2
|
)
|
|
(1.2
|
)%
|
Cost of products sold (exclusive of depreciation and amortization shown separately below)
|
1,629.3
|
|
|
1,654.5
|
|
|
(25.2
|
)
|
|
(1.5
|
)%
|
|||
Distribution expenses
|
126.2
|
|
|
127.5
|
|
|
(1.3
|
)
|
|
(1.0
|
)%
|
|||
Selling and administrative expenses
|
211.6
|
|
|
200.9
|
|
|
10.7
|
|
|
5.3
|
%
|
|||
Depreciation and amortization
|
13.1
|
|
|
13.5
|
|
|
(0.4
|
)
|
|
(3.0
|
)%
|
|||
Integration expenses
|
6.4
|
|
|
6.2
|
|
|
0.2
|
|
|
3.2
|
%
|
|||
Restructuring charges
|
4.1
|
|
|
1.7
|
|
|
2.4
|
|
|
141.2
|
%
|
|||
Operating income
|
3.9
|
|
|
15.5
|
|
|
(11.6
|
)
|
|
(74.8
|
)%
|
|||
Interest expense, net
|
6.4
|
|
|
6.5
|
|
|
(0.1
|
)
|
|
(1.5
|
)%
|
|||
Other expense, net
|
1.1
|
|
|
1.5
|
|
|
(0.4
|
)
|
|
(26.7
|
)%
|
|||
Income (loss) before income taxes
|
(3.6
|
)
|
|
7.5
|
|
|
(11.1
|
)
|
|
*
|
|
|||
Income tax expense (benefit)
|
(1.4
|
)
|
|
4.2
|
|
|
(5.6
|
)
|
|
*
|
|
|||
Net income (loss)
|
$
|
(2.2
|
)
|
|
$
|
3.3
|
|
|
$
|
(5.5
|
)
|
|
*
|
|
•
|
Does not reflect the Company’s income tax expenses or the cash requirements to pay its taxes; and
|
•
|
Although depreciation and amortization charges are non-cash charges, it does not reflect that the assets being depreciated and amortized will often have to be replaced in the future and the foregoing metrics do not reflect any cash requirements for such replacements.
|
(in millions)
|
Packaging
|
|
Facility Solutions
|
|
Print
|
|
Publishing
|
|
Corporate & Other
|
||||||||||
Three Months Ended March 31, 2017
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
$
|
721.8
|
|
|
$
|
306.8
|
|
|
$
|
698.7
|
|
|
$
|
234.0
|
|
|
$
|
33.3
|
|
Adjusted EBITDA
|
$
|
50.5
|
|
|
$
|
5.0
|
|
|
$
|
14.1
|
|
|
$
|
6.1
|
|
|
$
|
(45.9
|
)
|
Adjusted EBITDA as a % of net sales
|
7.0
|
%
|
|
1.6
|
%
|
|
2.0
|
%
|
|
2.6
|
%
|
|
*
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Three Months Ended March 31, 2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
$
|
671.5
|
|
|
$
|
301.0
|
|
|
$
|
759.1
|
|
|
$
|
262.3
|
|
|
$
|
25.9
|
|
Adjusted EBITDA
|
$
|
46.7
|
|
|
$
|
7.4
|
|
|
$
|
16.0
|
|
|
$
|
4.0
|
|
|
$
|
(39.2
|
)
|
Adjusted EBITDA as a % of net sales
|
7.0
|
%
|
|
2.5
|
%
|
|
2.1
|
%
|
|
1.5
|
%
|
|
*
|
|
|
Three Months Ended March 31,
|
|
2017 vs. 2016
|
|||||||
(in millions)
|
2017
|
|
2016
|
|
Increase (Decrease) %
|
|||||
Net sales
|
$
|
721.8
|
|
|
$
|
671.5
|
|
|
7.5
|
%
|
Adjusted EBITDA
|
$
|
50.5
|
|
|
$
|
46.7
|
|
|
8.1
|
%
|
Adjusted EBITDA as a % of net sales
|
7.0
|
%
|
|
7.0
|
%
|
|
|
|
Increase (Decrease)
|
||
|
Three Months Ended
March 31, |
||
(in millions)
|
2017 vs. 2016
|
||
Volume
|
$
|
54.4
|
|
Foreign currency
|
(1.6
|
)
|
|
Price/Mix
|
(2.5
|
)
|
|
Total change
|
$
|
50.3
|
|
|
Three Months Ended March 31,
|
2017 vs. 2016
|
||||||||
(in millions)
|
2017
|
|
2016
|
|
Increase (Decrease) %
|
|||||
Net sales
|
$
|
306.8
|
|
|
$
|
301.0
|
|
|
1.9
|
%
|
Adjusted EBITDA
|
$
|
5.0
|
|
|
$
|
7.4
|
|
|
(32.4
|
)%
|
Adjusted EBITDA as a % of net sales
|
1.6
|
%
|
|
2.5
|
%
|
|
|
|
Increase (Decrease)
|
||
|
Three Months Ended
March 31, |
||
(in millions)
|
2017 vs. 2016
|
||
Volume
|
$
|
7.8
|
|
Foreign currency
|
1.8
|
|
|
Price/Mix
|
(3.8
|
)
|
|
Total change
|
$
|
5.8
|
|
|
Three Months Ended March 31,
|
|
2017 vs. 2016
|
|||||||
(in millions)
|
2017
|
|
2016
|
|
Increase (Decrease) %
|
|||||
Net sales
|
$
|
698.7
|
|
|
$
|
759.1
|
|
|
(8.0
|
)%
|
Adjusted EBITDA
|
$
|
14.1
|
|
|
$
|
16.0
|
|
|
(11.9
|
)%
|
Adjusted EBITDA as a % of net sales
|
2.0
|
%
|
|
2.1
|
%
|
|
|
|
Increase (Decrease)
|
||
|
Three Months Ended
March 31, |
||
(in millions)
|
2017 vs. 2016
|
||
Volume
|
$
|
(65.1
|
)
|
Foreign currency
|
1.3
|
|
|
Price/Mix
|
3.4
|
|
|
Total change
|
$
|
(60.4
|
)
|
|
Three Months Ended March 31,
|
|
2017 vs. 2016
|
|||||||
(in millions)
|
2017
|
|
2016
|
|
Increase (Decrease) %
|
|||||
Net sales
|
$
|
234.0
|
|
|
$
|
262.3
|
|
|
(10.8
|
)%
|
Adjusted EBITDA
|
$
|
6.1
|
|
|
$
|
4.0
|
|
|
52.5
|
%
|
Adjusted EBITDA as a % of net sales
|
2.6
|
%
|
|
1.5
|
%
|
|
|
|
Increase (Decrease)
|
||
|
Three Months Ended
March 31, |
||
(in millions)
|
2017 vs. 2016
|
||
Volume
|
$
|
(29.0
|
)
|
Foreign currency
|
(0.1
|
)
|
|
Price/Mix
|
0.8
|
|
|
Total change
|
$
|
(28.3
|
)
|
|
Three Months Ended March 31,
|
2017 vs. 2016
|
||||||||
(in millions)
|
2017
|
|
2016
|
|
Increase (Decrease) %
|
|||||
Net sales
|
$
|
33.3
|
|
|
$
|
25.9
|
|
|
28.6
|
%
|
Adjusted EBITDA
|
$
|
(45.9
|
)
|
|
$
|
(39.2
|
)
|
|
(17.1
|
)%
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2017
|
|
2016
|
||||
Net cash provided by (used for):
|
|
|
|
||||
Operating activities
|
$
|
(40.8
|
)
|
|
$
|
74.5
|
|
Investing activities
|
(9.4
|
)
|
|
(7.9
|
)
|
||
Financing activities
|
32.6
|
|
|
(73.9
|
)
|
|
|
|
VERITIV CORPORATION
|
|
|
|
(Registrant)
|
|
|
|
|
Date:
|
May 3, 2017
|
|
By: /s/ Stephen J. Smith
|
|
|
|
Name: Stephen J. Smith
|
|
|
|
Title: Senior Vice President and Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|
|
|
|
|
Date:
|
May 3, 2017
|
|
By: /s/ W. Forrest Bell
|
|
|
|
Name: W. Forrest Bell
|
|
|
|
Title: Chief Accounting Officer
|
|
|
|
(Principal Accounting Officer)
|
1 Year Veritiv Chart |
1 Month Veritiv Chart |
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