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Core Insights - ACCO Brands has published its 2024 Environmental, Social, and Governance (ESG) Report, highlighting its commitment to sustainability and corporate responsibility [1] Group 1: Environmental Initiatives - The report outlines various environmental initiatives undertaken by the company, focusing on reducing carbon emissions and enhancing energy efficiency [1] - ACCO Brands aims to achieve significant reductions in waste and water usage across its operations [1] Group 2: Social Responsibility - The company emphasizes its dedication to social responsibility, including community engagement and employee well-being [1] - ACCO Brands has implemented programs to promote diversity and inclusion within its workforce [1] Group 3: Governance Practices - The ESG report details the governance practices in place to ensure ethical business conduct and transparency [1] - ACCO Brands is committed to maintaining high standards of corporate governance and accountability [1]

```markdown [PART I — FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents ACCO Brands' unaudited condensed consolidated financial statements and detailed notes for Q2 and H1 2025 and 2024 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's assets, liabilities, and stockholders' equity at specific points in time | (in millions) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $133.3 | $74.1 | | Total current assets | $835.9 | $731.5 | | Total assets | $2,377.6 | $2,228.4 | | **Liabilities and Stockholders' Equity** | | | | Total current liabilities | $452.9 | $490.3 | | Long-term debt, net | $944.1 | $783.3 | | Total liabilities | $1,740.3 | $1,622.3 | | Total stockholders' equity | $637.3 | $606.1 | | Total liabilities and stockholders' equity | $2,377.6 | $2,228.4 | - **Total assets increased by $149.2 million** from December 31, 2024, to June 30, 2025, primarily driven by increases in cash and cash equivalents, inventories, goodwill, and identifiable intangibles[17](index=17&type=chunk) - **Total liabilities increased by $118.0 million**, mainly due to a **significant increase in long-term debt, net, from $783.3 million to $944.1 million**[17](index=17&type=chunk) [Consolidated Statements of Income (Loss)](index=5&type=section&id=Consolidated%20Statements%20of%20Income%20%28Loss%29) This section details the company's revenues, expenses, and net income or loss over specific periods | (in millions, except per share data) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $394.8 | $438.3 | $712.2 | $797.2 | | Gross profit | $129.7 | $152.6 | $229.3 | $263.0 | | Operating income (loss) | $33.0 | $(111.2) | $26.3 | $(105.3) | | Net income (loss) | $29.2 | $(125.2) | $16.0 | $(131.5) | | Diluted income (loss) per share | $0.31 | $(1.29) | $0.17 | $(1.37) | - **Net sales decreased by 9.9%** for the three months ended June 30, 2025, and by **10.7%** for the six months ended June 30, 2025, compared to the prior year periods[19](index=19&type=chunk) - The company reported a **significant turnaround in operating income and net income**, moving from substantial losses in Q2 2024 and H1 2024 to positive income in Q2 2025 and H1 2025, largely due to the absence of the prior year's goodwill and intangible asset impairment charges[19](index=19&type=chunk) [Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) This section presents net income or loss and other comprehensive income or loss, reflecting non-owner equity changes | (in millions) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | $29.2 | $(125.2) | $16.0 | $(131.5) | | Other comprehensive income (loss) net of tax | $8.7 | $(11.3) | $36.7 | $(29.6) | | Comprehensive income (loss) | $37.9 | $(136.5) | $52.7 | $(161.1) | - **Comprehensive income significantly improved**, moving from a loss of **$136.5 million in Q2 2024 to an income of $37.9 million in Q2 2025**, primarily driven by the increase in net income and positive foreign currency translation adjustments[22](index=22&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section outlines cash inflows and outflows from operating, investing, and financing activities | (in millions) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash (used) provided by operating activities | $(33.4) | $2.6 | | Net cash used by investing activities | $(0.4) | $(4.8) | | Net cash provided by financing activities | $85.8 | $51.5 | | Net increase in cash and cash equivalents | $59.2 | $46.3 | | Cash and cash equivalents, end of period | $133.3 | $112.7 | - **Operating activities shifted from providing $2.6 million in cash in H1 2024 to using $33.4 million in H1 2025**, primarily due to changes in working capital and cash outflows for restructuring, taxes, interest, pensions, and incentives[25](index=25&type=chunk)[195](index=195&type=chunk) - **Financing activities provided significantly more cash in H1 2025 ($85.8 million) compared to H1 2024 ($51.5 million)**, mainly driven by increased borrowings and common stock repurchases[25](index=25&type=chunk)[199](index=199&type=chunk) [Consolidated Statement of Stockholders' Equity](index=8&type=section&id=Consolidated%20Statement%20of%20Stockholders%27%20Equity) This section details changes in the company's equity accounts over a period | (in millions) | Balance at December 31, 2024 | Balance at June 30, 2025 | | :--- | :--- | :--- | | Total Stockholders' Equity | $606.1 | $637.3 | | Net income (loss) | N/A | $29.2 | | Common stock repurchases | N/A | $(15.0) (March 31, 2025) / $(0.3) (June 30, 2025) | | Dividends declared | N/A | $(6.8) (March 31, 2025) / $(6.7) (June 30, 2025) | - **Total stockholders' equity increased from $606.1 million at December 31, 2024, to $637.3 million at June 30, 2025**, primarily due to net income and positive foreign currency translation adjustments, partially offset by common stock repurchases and dividends[28](index=28&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and additional information for the financial statements [1. Basis of Presentation](index=10&type=section&id=1.%20Basis%20of%20Presentation) This note describes the accounting principles and rules used in preparing the interim financial statements - The condensed consolidated interim financial statements are **unaudited** and prepared in accordance with SEC rules, condensing or omitting certain GAAP disclosures normally included in annual statements[35](index=35&type=chunk) - Management is responsible for the **accuracy and consistency of the financial statements**, which reflect all necessary adjustments for fair presentation[34](index=34&type=chunk)[36](index=36&type=chunk) [2. Recent Accounting Pronouncements and Adopted Accounting Standards](index=10&type=section&id=2.%20Recent%20Accounting%20Pronouncements%20and%20Adopted%20Accounting%20Standards) This note discusses new and recently adopted accounting standards and their potential impact on the company - The company is evaluating the impact of **ASU 2024-03** (Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disaggregation Disclosures) and **ASU 2023-09** (Income Taxes) on its financial statements, effective for annual periods beginning after December 15, 2026, and December 15, 2024, respectively[38](index=38&type=chunk)[39](index=39&type=chunk) - **ASU 2023-07 (Segment Reporting) was adopted in Q4 2024**, requiring disclosure of significant segment expenses and interim disclosures for reportable segment profit/loss and assets[42](index=42&type=chunk) [3. Acquisitions](index=11&type=section&id=3.%20Acquisitions) This note details recent business acquisitions and their financial implications - On February 28, 2025, ACCO Brands acquired Buro Seating Limited Partnership (Buro) for **AU$16.3 million (US$10.1 million)**, extending its presence in Australia and New Zealand into ergonomic seating[44](index=44&type=chunk) - The **Buro Acquisition was accounted for as a business combination**, and its results are included in the International operating segment's financial statements from February 28, 2025[44](index=44&type=chunk) [4. Long-term Debt and Short-term Borrowings](index=12&type=section&id=4.%20Long-term%20Debt%20and%20Short-term%20Borrowings) This note provides information on the company's debt structure, including types, amounts, and covenants | (in millions) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Euro Senior Secured Term Loan A | $140.4 | $127.9 | | Euro Dollar Senior Secured Revolving Credit Facility | $116.0 | $59.1 | | U.S. Dollar Senior Secured Revolving Credit Facility | $102.2 | $34.4 | | Australian Dollar Senior Secured Revolving Credit Facility | $34.4 | $32.8 | | Senior Unsecured Notes, due March 2029 (4.25% fixed) | $575.0 | $575.0 | | Other borrowings | $19.3 | $10.5 | | Total debt | $987.3 | $839.7 | | Long-term debt, net | $944.1 | $783.3 | - **Total debt increased by $147.6 million** from December 31, 2024, to June 30, 2025, primarily due to increased borrowings under the Euro and U.S. Dollar Senior Secured Revolving Credit Facilities[48](index=48&type=chunk) - As of June 30, 2025, the **Consolidated Leverage Ratio was approximately 4.29 to 1.00**, below the maximum covenant of 4.50 to 1.00[54](index=54&type=chunk) - An amendment to the Credit Agreement effective July 29, 2025, increases the maximum Consolidated Leverage Ratio covenant for certain future quarters and requires a **$35.0 million term loan repayment by September 30, 2025**[55](index=55&type=chunk) [5. Leases](index=13&type=section&id=5.%20Leases) This note outlines the company's lease arrangements, including costs and right-of-use assets | (in millions) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Operating lease cost | $14.4 | $14.6 | | Cash paid for operating leases | $15.0 | $14.8 | | Right-of-use assets obtained | $9.5 | $12.7 | - The **weighted average remaining lease term for operating leases is 5.4 years**, with a **weighted average discount rate of 5.3%** as of June 30, 2025[61](index=61&type=chunk) [6. Pension and Other Retiree Benefits](index=15&type=section&id=6.%20Pension%20and%20Other%20Retiree%20Benefits) This note details the costs and obligations related to the company's pension and post-retirement benefit plans | (in millions) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | U.S. Pension Net periodic benefit (income) cost | $(0.7) | $(0.7) | $(1.4) | $(1.4) | | International Pension Net periodic benefit (income) cost | $1.5 | $5.7 | $2.9 | $7.0 | | Post-retirement Net periodic benefit (income) cost | $(0.1) | $(0.1) | $(0.2) | $(0.2) | - **International pension net periodic benefit cost decreased significantly from $5.7 million in Q2 2024 to $1.5 million in Q2 2025**, partly due to a **$4.4 million settlement** from the wind-up of Canadian pension plans in Q2 2024[64](index=64&type=chunk) - The company expects to contribute approximately **$16.6 million to its defined benefit plans in 2025**, having contributed **$8.0 million** by June 30, 2025[65](index=65&type=chunk) [7. Stock-Based Compensation](index=15&type=section&id=7.%20Stock-Based%20Compensation) This note describes the company's stock-based compensation plans and related expenses | (in millions) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Total stock-based compensation expense | $0.5 | $2.5 | $8.3 | $7.6 | - **Total stock-based compensation expense decreased for the three months ended June 30, 2025, but increased for the six months ended June 30, 2025**, compared to the prior year periods[66](index=66&type=chunk) - As of June 30, 2025, **unrecognized compensation expense totaled $9.1 million for RSUs** (weighted average 2.1 years) and **$4.7 million for PSUs** (weighted average 1.5 years)[68](index=68&type=chunk) [8. Inventories](index=16&type=section&id=8.%20Inventories) This note provides a breakdown of the company's inventory components and their valuation | (in millions) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Raw materials | $45.2 | $35.9 | | Work in process | $4.3 | $3.3 | | Finished goods | $264.3 | $231.2 | | Total inventories | $313.8 | $270.4 | - **Total inventories increased by $43.4 million** from December 31, 2024, to June 30, 2025, primarily in finished goods and raw materials[69](index=69&type=chunk) [9. Goodwill and Identifiable Intangible Assets](index=16&type=section&id=9.%20Goodwill%20and%20Identifiable%20Intangible%20Assets) This note details the company's goodwill and other intangible assets, including changes and impairment assessments | (in millions) | Balance at December 31, 2024 | Balance at June 30, 2025 | | :--- | :--- | :--- | | Goodwill | $446.4 | $471.8 | | Identifiable intangibles, net | $709.6 | $719.5 | - **Goodwill increased by $25.4 million to $471.8 million** as of June 30, 2025, primarily due to **$4.2 million from the Buro Acquisition** and **$21.2 million from foreign currency translation**[73](index=73&type=chunk) - The company performed **qualitative assessments for goodwill and indefinite-lived trade names** as of May 31, 2025, concluding no impairment triggering events occurred[71](index=71&type=chunk)[76](index=76&type=chunk) - **Identifiable intangible assets, net, increased by $9.9 million to $719.5 million**, with **$5.8 million from the Buro Acquisition**[78](index=78&type=chunk)[81](index=81&type=chunk)[82](index=82&type=chunk) [10. Restructuring](index=18&type=section&id=10.%20Restructuring) This note outlines the company's restructuring activities, expenses, and liabilities | (in millions) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net restructuring expense (reduction) | $11.7 | $(0.6) | | Employee termination costs provision | $9.6 | $(0.9) | | Total restructuring liability (June 30) | $23.4 | $18.3 | - The company recorded **$11.7 million in net restructuring expense** for the six months ended June 30, 2025, primarily for severance and footprint rationalization in both Americas and International segments, a **significant increase from a $0.6 million net reduction** in the prior year[83](index=83&type=chunk) - Approximately **$15.6 million of the remaining $23.4 million restructuring liability** as of June 30, 2025, is expected to be paid within the next twelve months[84](index=84&type=chunk) [11. Income Taxes](index=19&type=section&id=11.%20Income%20Taxes) This note provides information on income tax expense, benefits, and significant tax-related events | (in millions) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Income (loss) before income tax | $22.7 | $(127.4) | $6.2 | $(132.7) | | Income tax benefit | $(6.5) | $(2.2) | $(9.8) | $(1.2) | - The **income tax benefit increased by $4.3 million for Q2 2025 and $8.6 million for H1 2025**, primarily due to a **net tax benefit of $13.4 million** from settling the Brazil Tax Assessments[19](index=19&type=chunk)[86](index=86&type=chunk)[87](index=87&type=chunk)[97](index=97&type=chunk) - ACCO Brazil settled tax assessments totaling **$7.1 million** under an amnesty program in June 2025, with an initial payment of **$2.0 million** and the remainder in installments through June 2026, resulting in the **release of a $20.5 million reserve**[95](index=95&type=chunk)[96](index=96&type=chunk)[97](index=97&type=chunk) - The company is assessing the impact of the recently enacted **One Big Beautiful Bill Act (OBBBA)** and monitoring the **OECD's Pillar Two Global Minimum Tax initiative**[89](index=89&type=chunk)[90](index=90&type=chunk) [12. Earnings per Share](index=21&type=section&id=12.%20Earnings%20per%20Share) This note details the calculation of basic and diluted earnings per share | (in millions except per share data) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | $29.2 | $(125.2) | $16.0 | $(131.5) | | Basic income (loss) per share | $0.32 | $(1.29) | $0.17 | $(1.37) | | Diluted income (loss) per share | $0.31 | $(1.29) | $0.17 | $(1.37) | | Weighted-average number of common shares outstanding (Basic) | 91.6 | 96.8 | 92.5 | 96.3 | | Weighted-average number of common shares outstanding (Diluted) | 93.1 | 96.8 | 94.3 | 96.3 | - **Diluted EPS significantly improved from a loss of $(1.29) in Q2 2024 to an income of $0.31 in Q2 2025**, and from a loss of **$(1.37) in H1 2024 to an income of $0.17 in H1 2025**[100](index=100&type=chunk) - The company repurchased and retired **3.2 million shares** during the six months ended June 30, 2025[102](index=102&type=chunk) [13. Derivative Financial Instruments](index=21&type=section&id=13.%20Derivative%20Financial%20Instruments) This note describes the company's use of derivative instruments for hedging and their fair values | (in millions) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Fair Value of Derivative Assets | $4.7 | $13.3 | | Fair Value of Derivative Liabilities | $8.8 | $9.3 | - The company uses **forward foreign currency contracts to hedge foreign denominated inventory purchases** (cash flow hedges) and **intercompany loans** (not designated as hedges), primarily against the Euro, Australian dollar, Canadian dollar, Swedish krona, British pound, and Japanese yen[105](index=105&type=chunk)[107](index=107&type=chunk)[108](index=108&type=chunk) - As of June 30, 2025, outstanding cash flow foreign exchange contracts had a **notional value of $92.3 million**, and non-designated contracts had a **notional value of $67.6 million**[107](index=107&type=chunk)[108](index=108&type=chunk) [14. Fair Value of Financial Instruments](index=23&type=section&id=14.%20Fair%20Value%20of%20Financial%20Instruments) This note provides information on the fair value measurements of the company's financial instruments - The company's derivative financial instruments (forward currency contracts) are classified as **Level 2 in the fair value hierarchy**, valued based on quoted foreign currency spot and forward rates[117](index=117&type=chunk) | (in millions) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Carrying amount of total debt | $987.3 | $839.7 | | Estimated fair value of total debt | $918.4 | $789.4 | - **Goodwill and indefinite-lived trade names are remeasured on a non-recurring basis**, considered **Level 3 measurements** due to significant unobservable inputs[121](index=121&type=chunk) [15. Accumulated Other Comprehensive Income (Loss)](index=24&type=section&id=15.%20Accumulated%20Other%20Comprehensive%20Income%20%28Loss%29) This note details the components of accumulated other comprehensive income or loss | (in millions) | Balance at December 31, 2024 | Balance at June 30, 2025 | | :--- | :--- | :--- | | Accumulated Other Comprehensive Income (Loss) | $(572.1) | $(535.4) | | Foreign Currency Adjustments | $(415.9) | $(368.0) | | Derivative Financial Instruments | $2.1 | $(2.7) | | Pension and Other Post-retirement Benefit Costs | $(158.3) | $(164.7) | - **Accumulated Other Comprehensive Loss improved from $(572.1) million at December 31, 2024, to $(535.4) million at June 30, 2025**, primarily due to positive foreign currency translation adjustments[122](index=122&type=chunk) [16. Revenue Recognition](index=25&type=section&id=16.%20Revenue%20Recognition) This note explains the company's policies for recognizing revenue from contracts with customers - Revenue is recognized when **control of promised goods or services is transferred to customers**, reflecting the expected consideration[125](index=125&type=chunk) | (in millions) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net sales (Total) | $394.8 | $438.3 | $712.2 | $797.2 | | ACCO Brands Americas | $248.5 | $292.3 | $422.4 | $489.5 | | ACCO Brands International | $146.3 | $146.0 | $289.8 | $307.7 | | Product and services transferred at a point in time | $386.2 | $429.8 | $695.4 | $778.7 | | Product and services transferred over time | $8.6 | $8.5 | $16.8 | $18.5 | - The **majority of net sales are from products and services transferred at a point in time**[132](index=132&type=chunk) [17. Information on Operating Segments](index=26&type=section&id=17.%20Information%20on%20Operating%20Segments) This note provides financial data and other information for the company's operating segments - The company operates in **two segments: ACCO Brands Americas** (U.S., Canada, Latin America) and **ACCO Brands International** (EMEA, Australia/N.Z., Asia), each designing, marketing, sourcing, manufacturing, and selling branded products[133](index=133&type=chunk)[136](index=136&type=chunk) | (in millions) | ACCO Brands Americas (Q2 2025) | ACCO Brands International (Q2 2025) | Total (Q2 2025) | | :--- | :--- | :--- | :--- | | Net sales | $248.5 | $146.3 | $394.8 | | Segment operating income (loss) | $40.7 | $0.8 | $41.5 | | (in millions) | ACCO Brands Americas (H1 2025) | ACCO Brands International (H1 2025) | Total (H1 2025) | | :--- | :--- | :--- | :--- | | Net Sales | $422.4 | $289.8 | $712.2 | | Segment operating income (loss) | $41.6 | $5.9 | $47.5 | - **Segment operating income for Americas was $40.7 million in Q2 2025** (vs. $(108.7) million in Q2 2024) and for **International was $0.8 million** (vs. $7.8 million in Q2 2024)[138](index=138&type=chunk) [18. Commitments and Contingencies](index=29&type=section&id=18.%20Commitments%20and%20Contingencies) This note discloses the company's legal and contractual commitments and potential liabilities - The **Brazil Tax Assessments were settled in June 2025** under an amnesty program, as detailed in Note 11[145](index=145&type=chunk) - Management believes the ultimate resolution of currently outstanding litigation and regulatory proceedings will **not have a material adverse effect on financial condition, results of operations, or cash flow**, but acknowledges no assurance of success in defense[147](index=147&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=31&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's analysis of ACCO Brands' financial condition and results of operations for the reported periods [Introduction](index=31&type=section&id=Introduction) This section introduces the Management's Discussion and Analysis, emphasizing its context with financial statements - This section should be read in conjunction with the **unaudited condensed consolidated financial statements and notes** for the three and six months ended June 30, 2025 and 2024[150](index=150&type=chunk) [Overview of the Company](index=31&type=section&id=Overview%20of%20the%20Company) This section provides a brief description of ACCO Brands' global business and product offerings - ACCO Brands is a **global consumer, technology, and business branded products company**, offering brands like At-A-Glance®, Kensington®, and PowerA®[151](index=151&type=chunk) - The company operates through **two segments, Americas and International**, selling products like gaming accessories, storage, notebooks, and office machines through diverse channels including mass retailers, e-tailers, and direct sales[152](index=152&type=chunk)[153](index=153&type=chunk) [Overview of Performance](index=31&type=section&id=Overview%20of%20Performance) This section summarizes the company's financial performance, highlighting key drivers and challenges - Performance was impacted by **softer global demand, weak macroeconomic conditions, geopolitical instability, and new U.S. and reciprocal tariffs**[154](index=154&type=chunk) | (in millions) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net sales | $394.8 | $438.3 | | Operating income (loss) | $33.0 | $(111.2) | | Operating cash flow (H1) | $(33.4) | $2.6 | - **Operating income improved significantly from a $111.2 million loss in Q2 2024 to a $33.0 million income in Q2 2025**, primarily due to the absence of **$165.2 million non-cash impairment charges** in the prior year[156](index=156&type=chunk) [Impact and Potential Impact of Tariffs](index=32&type=section&id=Impact%20and%20Potential%20Impact%20of%20Tariffs) This section discusses the effects of tariffs on the company's sales, costs, and strategic responses - **New U.S. tariffs in Q2 2025 led to customer purchasing disruptions, cancelled/delayed orders, and higher costs**, negatively impacting Americas segment sales and gross profit[155](index=155&type=chunk)[158](index=158&type=chunk) - The company is responding by implementing **price increases**, investing in inventory from lower-tariff countries, moving sourcing, negotiating with suppliers, and expanding **SKU rationalization**[162](index=162&type=chunk) [Consolidated Results of Operations for the Three and Six Months Ended June 30, 2025 and 2024](index=32&type=section&id=Consolidated%20Results%20of%20Operations%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) This section analyzes the company's overall financial performance for the reported periods [Net Sales](index=32&type=section&id=Net%20Sales) This section analyzes the company's revenue performance, including factors influencing changes | (in millions) | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net sales | $394.8 | $438.3 | $(43.5) | (9.9)% | | Comparable sales (Non-GAAP) | $392.2 | $438.3 | $(46.1) | (10.5)% | | (in millions) | H1 2025 | H1 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net sales | $712.2 | $797.2 | $(85.0) | (10.7)% | | Comparable sales (Non-GAAP) | $721.3 | $797.2 | $(75.9) | (9.6)% | - The **decline in net sales was primarily driven by lower volume** due to customer purchasing disruptions related to tariffs and reduced global demand for consumer and business products, partially offset by growth in gaming accessories[161](index=161&type=chunk)[163](index=163&type=chunk) [Gross Profit](index=33&type=section&id=Gross%20Profit) This section examines the company's gross profit and margin, detailing factors affecting profitability | (in millions) | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Gross profit | $129.7 | $152.6 | $(22.9) | (15.0)% | | Gross profit margin | 32.9% | 34.8% | N/A | (1.9) pts | | (in millions) | H1 2025 | H1 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Gross profit | $229.3 | $263.0 | $(33.7) | (12.8)% | | Gross profit margin | 32.2% | 33.0% | N/A | (0.8) pts | - **Gross profit decreased due to volume declines, unfavorable fixed-cost absorption, and tariff impacts**, partially offset by savings from global cost reduction actions[164](index=164&type=chunk)[165](index=165&type=chunk) [Selling, General and Administrative Expenses ("SG&A")](index=33&type=section&id=Selling%2C%20General%20and%20Administrative%20Expenses%20%28%22SG%26A%22%29) This section analyzes trends and drivers in the company's operating expenses | (in millions) | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | SG&A expenses | $82.6 | $88.0 | $(5.4) | (6.1)% | | (in millions) | H1 2025 | H1 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | SG&A expenses | $175.3 | $182.2 | $(6.9) | (3.8)% | - **SG&A expenses decreased due to global cost reductions and lower incentive compensation expense**[166](index=166&type=chunk)[167](index=167&type=chunk) [Operating Income (Loss)](index=33&type=section&id=Operating%20Income%20%28Loss%29) This section discusses the company's operating profitability and the factors contributing to its changes | (in millions) | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Operating income (loss) | $33.0 | $(111.2) | $144.2 | NM | | Operating income (loss) margin | 8.4% | (25.4)% | N/A | 33.8 pts | | (in millions) | H1 2025 | H1 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Operating income (loss) | $26.3 | $(105.3) | $131.6 | NM | | Operating income (loss) margin | 3.7% | (13.2)% | N/A | 16.9 pts | - **Operating income significantly improved from a loss in the prior year periods**, primarily due to the absence of **$165.2 million non-cash impairment charges** related to goodwill and an indefinite-lived trade name in the Americas segment[168](index=168&type=chunk)[169](index=169&type=chunk) - Current year operating income was **positively impacted by a $6.9 million gain on asset disposal and cost reduction actions**, but negatively by lower sales volume, unfavorable fixed-cost absorption, and higher restructuring expense[168](index=168&type=chunk)[169](index=169&type=chunk) [Interest Expense, Net](index=33&type=section&id=Interest%20Expense%2C%20Net) This section details the company's net interest expense and its influencing factors | (in millions) | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Interest expense, net | $8.9 | $11.6 | $(2.7) | (23.3)% | | (in millions) | H1 2025 | H1 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Interest expense, net | $17.8 | $23.0 | $(5.2) | (22.6)% | - **Interest expense, net, decreased due to lower variable interest rates on reduced variable debt balances**[170](index=170&type=chunk)[171](index=171&type=chunk) - The **weighted average interest rate on variable rate debt decreased to 4.76%** as of June 30, 2025, from **6.22%** in the prior year[171](index=171&type=chunk) [Income Tax Benefit](index=34&type=section&id=Income%20Tax%20Benefit) This section analyzes the company's income tax benefit and its primary drivers | (in millions) | Q2 2025 | Q2 2024 | Change ($) | | :--- | :--- | :--- | :--- | | Income tax benefit | $(6.5) | $(2.2) | $(4.3) | | Income (loss) before taxes | $22.7 | $(127.4) | N/A | | (in millions) | H1 2025 | H1 2024 | Change ($) | | :--- | :--- | :--- | :--- | | Income tax benefit | $(9.8) | $(1.2) | $(8.6) | | Income (loss) before taxes | $6.2 | $(132.7) | N/A | - The **increase in income tax benefit was primarily attributable to a net tax benefit of $13.4 million** from settling the Brazil Tax Assessments in June 2025[173](index=173&type=chunk) [Segment Net Sales and Operating Income for the Three and Six Months Ended June 30, 2025 and 2024](index=34&type=section&id=Segment%20Net%20Sales%20and%20Operating%20Income%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) This section provides a detailed breakdown of sales and operating income by the company's operating segments [ACCO Brands Americas](index=34&type=section&id=ACCO%20Brands%20Americas) This section analyzes the financial performance of the company's Americas operating segment | (in millions) | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net sales | $248.5 | $292.3 | $(43.8) | (15.0)% | | Comparable sales (Non-GAAP) | $251.6 | $292.3 | $(40.7) | (13.9)% | | Segment operating income (loss) | $40.7 | $(108.7) | $149.4 | NM | | (in millions) | H1 2025 | H1 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net sales | $422.4 | $489.5 | $(67.1) | (13.7)% | | Comparable sales (Non-GAAP) | $432.5 | $489.5 | $(57.0) | (11.6)% | | Segment operating income (loss) | $41.6 | $(102.6) | $144.2 | NM | - **Americas net sales decreased due to lower volume** from tariff-related customer disruptions and reduced demand for consumer/business products, partially offset by gaming accessories growth[175](index=175&type=chunk)[176](index=176&type=chunk) - **Segment operating income improved significantly from a loss in the prior year**, primarily due to the absence of **$165.2 million impairment charges**, partially offset by lower sales volume, unfavorable fixed-cost absorption, and higher restructuring expense[177](index=177&type=chunk)[178](index=178&type=chunk)[179](index=179&type=chunk) [ACCO Brands International](index=35&type=section&id=ACCO%20Brands%20International) This section analyzes the financial performance of the company's International operating segment | (in millions) | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net sales | $146.3 | $146.0 | $0.3 | 0.2% | | Comparable sales (Non-GAAP) | $140.6 | $146.0 | $(5.4) | (3.7)% | | Segment operating income | $0.8 | $7.8 | $(7.0) | (89.7)% | | (in millions) | H1 2025 | H1 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net sales | $289.8 | $307.7 | $(17.9) | (5.8)% | | Comparable sales (Non-GAAP) | $288.8 | $307.7 | $(18.9) | (6.1)% | | Segment operating income | $5.9 | $20.6 | $(14.7) | (71.4)% | - **International net sales were flat in Q2 2025 but decreased in H1 2025**, primarily due to lower volume from reduced demand for business products, partially offset by price increases, the Buro Acquisition, and growth in gaming/technology accessories[181](index=181&type=chunk) - **Segment operating income decreased significantly due to higher restructuring costs and lower sales volume**, partially offset by cost savings, price increases, and a gain on asset disposal[182](index=182&type=chunk)[183](index=183&type=chunk) [Liquidity and Capital Resources](index=35&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's ability to generate and manage cash, including debt and capital allocation - Primary liquidity sources are operating cash flows, **cash on hand ($133.3 million as of June 30, 2025)**, and seasonal borrowings under the **$467.5 million Revolving Facility**, which had **$206.8 million available for borrowings**[184](index=184&type=chunk) - The **Consolidated Leverage Ratio was approximately 4.29 to 1.00** as of June 30, 2025, below the maximum covenant of 4.50 to 1.00[185](index=185&type=chunk) - Cash flow priorities, after business operations, include **debt reduction, dividends, share repurchases, and strategic acquisitions**[185](index=185&type=chunk) - A multi-year restructuring and cost savings program aims for **$100.0 million in annualized pre-tax savings by end of 2026**, with **over $40.0 million already realized**[191](index=191&type=chunk) [Cash Flow for the Six Months Ended June 30, 2025 and 2024](index=37&type=section&id=Cash%20Flow%20for%20the%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) This section provides a detailed analysis of cash flows from operating, investing, and financing activities | (in millions) | H1 2025 | H1 2024 | Change ($) | | :--- | :--- | :--- | :--- | | Net cash flow provided (used) by: | | | | | Operating activities | $(33.4) | $2.6 | $(36.0) | | Investing activities | $(0.4) | $(4.8) | $4.4 | | Financing activities | $85.8 | $51.5 | $34.3 | | Net increase in cash and cash equivalents | $59.2 | $46.3 | $12.9 | - **Cash used by operating activities in H1 2025 was $33.4 million**, primarily due to cash used for trade working capital and other liabilities, partially offset by cash inflows excluding non-cash impacts[195](index=195&type=chunk) - **Cash used by investing activities was minimal at $0.4 million in H1 2025**, as the Buro Acquisition and capital expenditures were largely offset by **$16.5 million in proceeds from asset dispositions**[197](index=197&type=chunk) - **Cash provided by financing activities increased to $85.8 million in H1 2025**, driven by borrowings exceeding debt repayments, partially offset by dividends and common stock repurchases[199](index=199&type=chunk) [Supplemental Non-GAAP Financial Measure](index=37&type=section&id=Supplemental%20Non-GAAP%20Financial%20Measure) This section explains and reconciles non-GAAP financial measures used to assess performance - **Comparable sales, a non-GAAP measure**, exclude the impact of material acquisitions and translate current-period foreign operation sales at prior-year currency rates to provide a clearer understanding of underlying operational results[201](index=201&type=chunk)[202](index=202&type=chunk) | (in millions) | Q2 2025 GAAP Net Sales | Q2 2025 Currency Translation | Q2 2025 Non-GAAP Comparable Sales | | :--- | :--- | :--- | :--- | | ACCO Brands Americas | $248.5 | $(3.1) | $251.6 | | ACCO Brands International | $146.3 | $5.7 | $140.6 | | Total | $394.8 | $2.6 | $392.2 | | (in millions) | H1 2025 GAAP Net Sales | H1 2025 Currency Translation | H1 2025 Non-GAAP Comparable Sales | | :--- | :--- | :--- | :--- | | ACCO Brands Americas | $422.4 | $(10.1) | $432.5 | | ACCO Brands International | $289.8 | $1.0 | $288.8 | | Total | $712.2 | $(9.1) | $721.3 | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=39&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section provides disclosures on market risks, confirming no material changes in foreign exchange or interest rate management for the quarter - **No material changes occurred in Foreign Exchange Risk Management or Interest Rate Risk Management** during the quarter ended June 30, 2025[210](index=210&type=chunk) [Item 4. Controls and Procedures](index=39&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of disclosure controls and procedures and reports no material changes in internal control over financial reporting for the quarter - The Chief Executive Officer and Chief Financial Officer concluded that **disclosure controls and procedures were effective as of June 30, 2025**[211](index=211&type=chunk) - **No material changes in internal control over financial reporting occurred** during the quarter ended June 30, 2025[212](index=212&type=chunk) [PART II — OTHER INFORMATION](index=39&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=39&type=section&id=Item%201.%20Legal%20Proceedings) This section addresses legal and regulatory proceedings, including settled Brazil Tax Assessments, with management expecting no material adverse financial impact - The **Brazil Tax Assessments were settled in June 2025** under an amnesty program[214](index=214&type=chunk) - Management believes the ultimate resolution of currently outstanding legal matters will **not have a material adverse effect on financial condition, results of operations, or cash flow**, but future claims could[215](index=215&type=chunk) [Item 1A. Risk Factors](index=40&type=section&id=Item%201A.%20Risk%20Factors) This section reports no material changes to risk factors from the Annual Report on Form 10-K, except as updated in the Q1 2025 Quarterly Report - **No material changes to risk factors** from the Annual Report on Form 10-K for December 31, 2024, except as updated in the Quarterly Report on Form 10-Q for March 31, 2025[217](index=217&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=40&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section reports no common stock repurchases during Q2 2025, with $75.6 million remaining under the share repurchase authorization | Period | Total Number of Shares Purchased | Average Price Paid per Share | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program | | :--- | :--- | :--- | :--- | | April 1, 2025 to April 30, 2025 | — | $— | $75,645,700 | | May 1, 2025 to May 31, 2025 | — | $— | $75,645,700 | | June 1, 2025 to June 30, 2025 | — | $— | $75,645,700 | | Total | — | $— | $75,645,700 | - The company did **not repurchase any common stock** during the quarter ended June 30, 2025[220](index=220&type=chunk) - As of June 30, 2025, **$75,645,700 remained available** under the **$100 million share repurchase authorization**[220](index=220&type=chunk) [Item 3. Defaults Upon Senior Securities](index=40&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section states that there were no defaults upon senior securities during the reporting period - **No defaults upon senior securities occurred**[221](index=221&type=chunk) [Item 4. Mine Safety Disclosures](index=40&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section indicates that mine safety disclosures are not applicable to the company - **Mine safety disclosures are not applicable**[222](index=222&type=chunk) [Item 5. Other Information](index=41&type=section&id=Item%205.%20Other%20Information) This section reports no director or officer adopted, materially modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter - **No director or officer adopted, materially modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement** during the quarter[223](index=223&type=chunk) [Item 6. Exhibits](index=41&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including certifications and other relevant documents - Exhibits include **certifications (31.1, 31.2, 32.1, 32.2)**, the **Second Amendment to the 2022 ACCO Brands Corporation Incentive Plan (10.1)**, and **Inline XBRL documents (101.INS, 101.SCH, 104)**[224](index=224&type=chunk) [SIGNATURES](index=42&type=section&id=SIGNATURES) This section formally concludes the report with the required signatures of authorized company executives - The report is duly signed on behalf of ACCO Brands Corporation by **Thomas W. Tedford (President and CEO)**, **Deborah A. O'Connor (EVP and CFO)**, and **James M. Dudek, Jr. (SVP, Corporate Controller and Chief Accounting Officer)** on August 1, 2025[226](index=226&type=chunk)[227](index=227&type=chunk) ```

Financial Data and Key Metrics Changes - Consolidated second quarter comparable sales decreased by 10.5%, aligning with guidance [9] - Reported sales in the second quarter decreased by 10%, with a slight favorable FX impact [18] - Gross profit for the second quarter was $130 million, a decrease of 15%, with the margin rate contracting about 200 basis points to 32.9% [19] - Adjusted operating income for the second quarter was $47 million, down from $65 million a year ago [20] - Year-to-date adjusted free cash flow was an outflow of $24 million, in line with expectations [23] Business Line Data and Key Metrics Changes - In the Americas segment, comparable sales declined by 14%, primarily due to purchasing disruptions and soft demand [20] - The international segment saw comparable sales decline by 4%, an improvement from the first quarter [22] - Gaming accessories grew mid-single digits, driven by the Nintendo Switch 2 launch [12] Market Data and Key Metrics Changes - Sales in Latin America were weaker than expected, particularly in Mexico, due to constrained consumer spending and competition at lower price points [10] - In Europe, demand remained soft, especially in Germany, the UK, and France, but market share was maintained or grew in most categories [12][22] Company Strategy and Development Direction - The company is focused on a $100 million multiyear cost reduction program, achieving over $40 million in cumulative savings to date [6][16] - Strategic price increases have been announced to mitigate tariff impacts while maintaining competitive positioning [8][25] - The company is expanding its product offerings into higher growth categories through both organic and inorganic initiatives [14][15] Management's Comments on Operating Environment and Future Outlook - Management noted that the evolving tariff environment continues to create uncertainty in demand, particularly in the Americas segment [25] - The company expects reported sales to decline by 7% to 8.5% for the full year, with adjusted EPS projected between 83 cents to 90 cents [26] - Management expressed confidence in long-term growth despite current challenges, citing a strong balance sheet and consistent cash flow generation [27] Other Important Information - The company successfully settled a long-standing tax assessment in Brazil, reducing the reserve from $20 million to $7 million [21] - The company has amended its bank credit agreement to increase its leverage covenant by 50 basis points for the remainder of 2025 [24] Q&A Session Summary Question: Impact of back-to-school season on sales - Management indicated that the decline in sales is attributed to a mix of factors including pre-buying in the first quarter and cautious purchasing due to tariffs [29][30] Question: Contribution of new product development to revenue - Management expects modest benefits from new products in the second half, with more significant impacts anticipated in 2026 [34] Question: Adjustments to product assortment in response to demand - Management confirmed that they are adjusting product assortments to remain competitive against lower-cost competitors from China [39][40] Question: Pricing increases and gross margin expectations - Management expects gross margin to improve modestly in the second half, with pricing initiatives aimed at covering tariff costs [45] Question: Market share expectations for back-to-school season - Management stated it is too early to determine market share changes, but they believe they are well-positioned with their product offerings [69][70] Question: Incremental sales from gaming accessories - Management noted it is premature to provide specific dollar amounts for incremental sales from gaming accessories, with the holiday season being crucial for sales [72]

Financial Data and Key Metrics Changes - Consolidated second quarter comparable sales decreased by 10.5%, aligning with guidance [8][19] - Reported sales for the second quarter decreased by 10%, with a slight favorable FX impact [19] - Gross profit for the second quarter was $130 million, a decrease of 15%, with the margin rate contracting about 200 basis points to 32.9% [20] - Adjusted operating income for the second quarter was $47 million, down from $65 million a year ago [21] - Year-to-date adjusted free cash flow was an outflow of $24 million, in line with expectations [24] Business Line Data and Key Metrics Changes - In the Americas segment, comparable sales declined by 14%, primarily due to purchasing disruptions and soft demand [21] - The international segment saw comparable sales decline by 4%, an improvement from the first quarter [23] - Gaming accessories grew mid-single digits, driven by the Nintendo Switch 2 launch [11][12] - Sales of office products remained soft in Europe, particularly in Germany, the UK, and France [12][23] Market Data and Key Metrics Changes - Sales in Latin America were weaker than expected, particularly in Mexico, due to constrained consumer spending and competition at lower price points [10] - In Brazil, sales were down modestly, with back-to-school sales expected to occur later in the year [11] - The company noted an increase in low-priced products entering Latin America from China, prompting adjustments in pricing and product assortment [11][41] Company Strategy and Development Direction - The company is focused on a $100 million multiyear cost reduction program, achieving over $40 million in cumulative savings to date [6][16] - Strategic price increases have been announced to mitigate tariff impacts while maintaining competitive positioning [7][27] - The company is expanding its product offerings in higher growth categories through both organic and inorganic initiatives [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current market dynamics with discipline and agility, despite ongoing uncertainties [17][29] - The outlook for the third quarter and full year anticipates reported sales to decline by 7% to 8.5% [28] - Management expects pricing actions to partially mitigate continued softness in consumer and business spending [28] Other Important Information - The company successfully settled a long-standing tax assessment in Brazil, reducing the reserve from $20 million to $7 million [22][61] - The company amended its bank credit agreement to increase its leverage covenant by 50 basis points for the remainder of 2025 [25] Q&A Session Summary Question: Impact of back-to-school season on sales - Management noted that the decline in sales is attributed to a mix of factors including shifts in purchasing and lower market demand, with inventory levels being managed tightly by retailers [31][34] Question: Contribution of new product development to revenue - Management indicated that the benefit from new products will be modest in the second half, with more significant impacts expected in 2026 [36] Question: Adjustments to product assortment in response to demand - Management confirmed that they are adjusting product assortments to remain competitive against lower-cost competitors from China [40][41] Question: Pricing increases and gross margin expectations - Management expects modest improvement in gross margin in the second half, with pricing initiatives aimed at covering tariff costs [46][47] Question: Market share expectations for back-to-school season - Management stated it is too early to determine market share changes, but they are well-positioned with strong brand offerings [71][72] Question: Incremental sales opportunities from gaming accessories - Management indicated it is premature to provide specific dollar amounts for gaming accessory sales, but they are optimistic about the upcoming holiday season [73][74]

Financial Performance - Net sales decreased by 99% from $4383 million to $3948 million in Q2 2025[37] - Comparable sales decreased by 105%[37] - Adjusted earnings per share decreased by 243% from $037 to $028[37] - Adjusted free cash flow was an outflow of $24 million year-to-date[60] Segment Performance - ACCO Brands Americas sales decreased by 150% from $2923 million to $2485 million[42] - ACCO Brands International sales increased slightly by 02% from $1460 million to $1463 million[42] - ACCO Brands Americas adjusted operating income decreased by 316% from $632 million to $432 million[42] - ACCO Brands International adjusted operating income increased by 60% from $117 million to $124 million[42] Cost Reduction and Debt - The company is executing a multi-year cost reduction program targeting at least $100 million in savings[32] - Over $40 million in savings have been realized since the program's inception[35] - Net debt decreased by $19 million year-over-year[16] Outlook - Q3 2025 net sales are projected to be between $387 million and $400 million, a decrease of 50% to 80%[63] - Full year 2025 net sales are projected to be between $1525 billion and $1550 billion, a decrease of 70% to 85%[67]

Core Viewpoint - Acco Brands reported quarterly earnings of $0.28 per share, missing the Zacks Consensus Estimate of $0.29 per share, and down from $0.37 per share a year ago, indicating a -3.45% earnings surprise [1] Financial Performance - The company posted revenues of $394.8 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.28%, but down from $438.3 million year-over-year [2] - Over the last four quarters, Acco has surpassed consensus EPS estimates just once and topped consensus revenue estimates two times [2] Stock Performance - Acco shares have lost about 28% since the beginning of the year, contrasting with the S&P 500's gain of 8.2% [3] - The current Zacks Rank for Acco is 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the coming quarter is $0.26 on revenues of $382.43 million, and $0.94 on revenues of $1.53 billion for the current fiscal year [7] - The estimate revisions trend for Acco was mixed ahead of the earnings release, which could change following the recent report [6] Industry Context - The Office Supplies industry is currently in the top 39% of over 250 Zacks industries, suggesting that it has a favorable outlook compared to the bottom 50% [8]

[Eighth Amendment to Third Amended and Restated Credit Agreement](index=1&type=section&id=EIGHTH%20AMENDMENT%20TO%20THIRD%20AMENDED%20AND%20RESTATED%20CREDIT%20AGREEMENT) This section details the Eighth Amendment to the Credit Agreement, outlining its effective conditions, reaffirmations, and general provisions [Introduction and Parties](index=1&type=section&id=Introduction%20and%20Parties) This document, dated July 29, 2025, constitutes the Eighth Amendment to the Credit Agreement, entered into by ACCO Brands Corporation and various lenders - The Eighth Amendment to the Credit Agreement is dated July 29, 2025[2](index=2&type=chunk) - The amendment is made with the consent of the Required Lenders to modify the existing Credit Agreement[2](index=2&type=chunk)[4](index=4&type=chunk) [Amendments to Loan Documents](index=1&type=section&id=SECTION%20I.%20AMENDMENTS%20TO%20LOAN%20DOCUMENTS) This section details that the Credit Agreement will be amended on the Closing Date as specified in Exhibit A, showing all textual changes - The Credit Agreement is amended as set forth in Exhibit A, which shows deletions and additions to the text[5](index=5&type=chunk) [Conditions to Effectiveness](index=2&type=section&id=SECTION%20II.%20CONDITIONS%20TO%20THE%20EIGHTH%20AMENDMENT%20CLOSING%20DATE) The amendment's effectiveness on the "Eighth Amendment Closing Date" is contingent upon execution by all parties, receipt of corporate documents, and absence of defaults - The amendment's effectiveness is contingent upon its due execution by Holdings, the Borrowers, other Loan Parties, the Administrative Agent, and the Consenting Lenders[7](index=7&type=chunk) - Key deliverables to the Administrative Agent include organizational documents, resolutions, a solvency certificate, and a certificate of compliance with other conditions[8](index=8&type=chunk) - A critical condition is that no Default or Event of Default exists or would result from the amendment[12](index=12&type=chunk) - All accrued costs, fees, and expenses owed to the Administrative Agent must be paid[13](index=13&type=chunk) [Representations and Warranties](index=3&type=section&id=SECTION%20III.%20REPRESENTATIONS%20AND%20WARRANTIES) Loan Parties provide representations and warranties regarding their legal status, authorization, absence of conflicts, and reaffirm the accuracy of prior representations - Each Loan Party confirms its due organization, valid existence, and requisite power to execute the amendment and perform its obligations[15](index=15&type=chunk) - The execution of the amendment does not contravene the Loan Party's organizational documents, conflict with any material contracts, or violate any laws[15](index=15&type=chunk) - The representations and warranties contained in Article 5 of the Amended Credit Agreement are reaffirmed as true and correct[18](index=18&type=chunk) [Acknowledgment and Reaffirmation](index=4&type=section&id=SECTION%20IV.%20ACKNOWLEDGMENT%20AND%20CONSENT%3B%20REAFFIRMATION) Loan Parties and Guarantors acknowledge the amendment and reaffirm that their obligations and security interests under the original Loan Documents remain fully effective - Each Loan Party confirms that its pledges and grants of security interests under the existing Loan Documents are not impaired and continue in full force to secure all Obligations[16](index=16&type=chunk) - Each Guarantor consents to the amendment and confirms that their guarantees continue to cover all Obligations under the Amended Credit Agreement[17](index=17&type=chunk)[19](index=19&type=chunk) [Miscellaneous Provisions](index=5&type=section&id=SECTION%20V.%20MISCELLANEOUS) This section clarifies that the amendment is not a novation, designates it as a Loan Document, and specifies New York law as governing - The amendment is not a novation but an amendment of the pre-existing Credit Agreement[24](index=24&type=chunk) - The amendment and all related claims are governed by the law of the State of New York[23](index=23&type=chunk) - Except as specifically amended, the original Credit Agreement and other Loan Documents remain in full force and effect[22](index=22&type=chunk) [Third Amended and Restated Credit Agreement (Conformed)](index=19&type=section&id=THIRD%20AMENDED%20AND%20RESTATED%20CREDIT%20AGREEMENT) This section presents the conformed Third Amended and Restated Credit Agreement, incorporating all subsequent amendments [Article 1: Definitions and Accounting Terms](index=29&type=section&id=Article%201%20Definitions%20and%20Accounting%20Terms) This article defines key terms, including loan facilities, interest rates, financial ratios, and the "Covenant Relief Period" with its specific pricing grid - The **"Covenant Relief Period"** is defined as the period from the Eighth Amendment Closing Date (July 29, 2025) through and including December 31, 2026[142](index=142&type=chunk)[182](index=182&type=chunk) Applicable Rate During Covenant Relief Period (Post-8th Amendment) | Rate Type | Margin/Fee | | :--- | :--- | | Term SOFR / Daily SOFR / Agreed Currency Rate / etc. | 2.25% | | Base Rate | 1.25% | | Letter of Credit Fees (financial) | 0.50% | | Letter of Credit Fees (commercial) | 1.125% | Applicable Rate Post-Covenant Relief Period | Pricing Level | Consolidated Leverage Ratio | Term SOFR, etc. Margin | Base Rate Margin | Commitment Fee Rate | | :--- | :--- | :--- | :--- | :--- | | 1 | > 4.25 to 1.00 | 2.25% | 1.25% | 0.375% | | 2 | ≤ 4.25 to 1.00 and > 3.50 to 1.00 | 2.00% | 1.00% | 0.350% | | 3 | ≤ 3.50 to 1.00 and > 2.50 to 1.00 | 1.75% | 0.75% | 0.300% | | 4 | ≤ 2.50 to 1.00 | 1.50% | 0.50% | 0.250% | [Article 2: The Commitments and Credit Extensions](index=99&type=section&id=Article%202%20The%20Commitments%20and%20Credit%20Extensions) This article details credit facilities, including Term A Loans and a Revolving Credit Facility, outlining borrowing procedures, prepayments, and a new mandatory Euro Term A Loan repayment Credit Facilities Overview (as of 7th/8th Amendments) | Facility | Amount | | :--- | :--- | | Multicurrency Revolving Credit Facility | $467,500,000 | | EUR Term Loan A Facility | €122,890,001.85 | | Australian Dollar Term A Loan | AUD $61,000,000 | | U.S. Dollar Term A Loan | $100,000,000 | - A new mandatory repayment for the Euro Term A Loans is added, requiring a payment of the Euro equivalent of **$35,000,000** on or prior to September 30, 2025[566](index=566&type=chunk) - Mandatory prepayments are required from Net Cash Proceeds of certain asset dispositions (in excess of **$12 million/year**), incurrence of non-permitted Indebtedness, and Extraordinary Receipts (in excess of **$10 million/year**)[550](index=550&type=chunk)[552](index=552&type=chunk)[553](index=553&type=chunk) [Article 3: Taxes, Yield Protection and Illegality](index=132&type=section&id=Article%203%20Taxes%2C%20Yield%20Protection%20and%20Illegality) This article addresses tax obligations, lender compensation for increased costs due to law changes, and fallback provisions for unavailable benchmark interest rates - Loan Parties are obligated to make payments free and clear of any tax deductions or withholdings and must indemnify the Lenders for any Indemnified Taxes[633](index=633&type=chunk)[635](index=635&type=chunk) - If a change in law increases a Lender's cost of making or maintaining a loan, the Borrowers must pay additional amounts to compensate the Lender for such increased costs[662](index=662&type=chunk)[664](index=664&type=chunk) - The agreement includes detailed fallback provisions for determining interest rates if a benchmark rate like SOFR or EURIBOR becomes unavailable, allowing the Administrative Agent to implement a successor rate[650](index=650&type=chunk)[653](index=653&type=chunk)[657](index=657&type=chunk) [Article 4: Conditions Precedent](index=143&type=section&id=Article%204%20Conditions%20Precedent) This article specifies that credit extensions are contingent upon the accuracy of Loan Party representations and the absence of any Default or Event of Default - The obligation of each Lender to honor any Request for Credit Extension is subject to the condition that all representations and warranties of the Loan Parties are true and correct in all material respects[679](index=679&type=chunk) - A further condition for any credit extension is that no Default or Event of Default exists or would result from the proposed credit extension[680](index=680&type=chunk) [Article 5: Representations and Warranties](index=144&type=section&id=Article%205%20Representations%20and%20Warranties) This article details comprehensive representations and warranties by Loan Parties covering legal status, financial condition, compliance with laws, and collateral validity - Loan Parties represent they are in compliance with all applicable laws, including sanctions (OFAC), the Foreign Corrupt Practices Act (FCPA), and other anti-corruption laws[724](index=724&type=chunk)[725](index=725&type=chunk)[727](index=727&type=chunk) - The company represents that it is **Solvent** and that its financial statements fairly present its financial condition in accordance with GAAP[691](index=691&type=chunk)[721](index=721&type=chunk) - It is represented that the Collateral Documents create a valid and enforceable first-priority lien on the Collateral, subject to Permitted Liens[722](index=722&type=chunk) [Article 6: Affirmative Covenants](index=151&type=section&id=Article%206%20Affirmative%20Covenants) This article outlines affirmative covenants requiring Borrowers to deliver financial statements, compliance certificates, and promptly notify the Agent of defaults or adverse events - The company must deliver annual audited financial statements within **90 days** of fiscal year-end and quarterly unaudited financial statements within **45 days** of each quarter-end[730](index=730&type=chunk) - A compliance certificate must be delivered concurrently with financial statements[733](index=733&type=chunk) - The company must promptly notify the Administrative Agent of any Default, Material Adverse Effect, or ERISA Event[737](index=737&type=chunk) [Article 7: Negative Covenants](index=158&type=section&id=Article%207%20Negative%20Covenants) This article imposes negative covenants restricting liens, indebtedness, investments, asset sales, and restricted payments, including financial ratios with temporary relief from the Eighth Amendment Financial Covenants | Covenant | Requirement | | :--- | :--- | | **Consolidated Interest Coverage Ratio** | ≥ 3.00 to 1.00 | | **Consolidated Leverage Ratio** | Varies by quarter, with specific higher levels permitted during the Covenant Relief Period (e.g., up to 4.75:1.00 for Q4 2025 - Q2 2026) | - The Eighth Amendment adjusts the Maximum Consolidated Leverage Ratio for fiscal quarters ending between September 30, 2025, and December 31, 2026, providing covenant relief[788](index=788&type=chunk) - Restrictions are placed on creating liens, incurring indebtedness, making investments, and making restricted payments, subject to specific baskets and exceptions[762](index=762&type=chunk)[765](index=765&type=chunk)[768](index=768&type=chunk)[780](index=780&type=chunk) [Article 8: Events of Default and Remedies](index=172&type=section&id=Article%208%20Events%20of%20Default%20and%20Remedies) This article defines Events of Default, such as non-payment or covenant violations, and outlines remedies including commitment termination and loan acceleration - Events of Default include failure to pay principal or interest, breach of covenants (with specified grace periods), and material misrepresentations[799](index=799&type=chunk) - A cross-default is triggered if the company defaults on other indebtedness exceeding an aggregate principal amount of **$40 million**[799](index=799&type=chunk)[439](index=439&type=chunk) - Upon an Event of Default, remedies include the termination of commitments and the acceleration of all outstanding Obligations, making them immediately due and payable[802](index=802&type=chunk) [Article 9: Administrative Agent](index=175&type=section&id=Article%209%20Administrative%20Agent) This article appoints Bank of America, N.A. as the Administrative Agent, defining its administrative role, exculpatory protections, and succession procedures - Bank of America, N.A. is appointed as the Administrative Agent and Collateral Agent to act on behalf of the Lenders[806](index=806&type=chunk)[807](index=807&type=chunk) - The Agent is protected by exculpatory provisions and is not liable for actions taken without gross negligence or willful misconduct[809](index=809&type=chunk)[810](index=810&type=chunk) - The Agent is authorized to release collateral or guarantors in connection with permitted transactions, such as asset sales, or upon the full repayment of all obligations[823](index=823&type=chunk) [Article 10: Debt Allocation Mechanism](index=182&type=section&id=Article%2010%20Debt%20Allocation%20Mechanism) This article describes the Debt Allocation Mechanism (DAM), which ensures pro-rata sharing of loan interests among lenders upon major default events - Upon a "DAM Exchange Date" (e.g., bankruptcy or acceleration), Lenders' interests in the various loan facilities are automatically exchanged[836](index=836&type=chunk) - The exchange results in each Lender holding a pro-rata interest (its "DAM Percentage") in the entire portfolio of Term Loans and Revolving Loans, ensuring shared risk and recovery[836](index=836&type=chunk)[837](index=837&type=chunk) [Article 11: Miscellaneous](index=185&type=section&id=Article%2011%20Miscellaneous) This article covers standard provisions including amendment procedures, governing law (New York), jurisdiction, waiver of jury trial, and confidentiality - Amendments to the agreement generally require the consent of the Required Lenders, but fundamental changes like postponing payment dates or reducing principal require the consent of each affected Lender[848](index=848&type=chunk) - The agreement and all related disputes are governed by the laws of the State of New York, and all parties submit to the exclusive jurisdiction of New York courts[909](index=909&type=chunk)[910](index=910&type=chunk) - All parties irrevocably waive their right to a trial by jury in any legal proceeding related to the Loan Documents[913](index=913&type=chunk)

Group 1 - Cadiz (CDZI) focuses on acquiring and developing water-related land and agricultural assets, with a 40% downward revision in the Zacks Consensus Estimate for its current year earnings over the last 60 days [1] - ArriVent BioPharma, Inc. (AVBP) is a clinical-stage biopharmaceutical company targeting unmet medical needs in cancer treatment, experiencing a 7.3% downward revision in the Zacks Consensus Estimate for its current year earnings over the last 60 days [2] - Acco Brands (ACCO) is a leading company in branded office products, with a 5.1% downward revision in the Zacks Consensus Estimate for its current year earnings over the last 60 days [3]

Financial Performance - Net sales for Q1 2025 were $317.4 million, a decrease of 11.5% compared to $358.9 million in Q1 2024[19] - Gross profit for Q1 2025 was $99.6 million, down from $110.4 million in Q1 2024, reflecting a gross margin decline[19] - The company reported a net loss of $13.2 million in Q1 2025, compared to a net loss of $6.3 million in Q1 2024, indicating a worsening financial performance[19] - Operating cash flow for Q1 2025 was $5.5 million, significantly lower than $28.2 million in Q1 2024[24] - The company reported an operating loss of $6.7 million in Q1 2025, compared to operating income of $5.9 million in Q1 2024, primarily due to lower sales volume and higher restructuring expenses[154] - For Q1 2025, the company reported a net loss of $13.2 million, compared to a net loss of $6.3 million in Q1 2024[99] - Basic and diluted loss per share for Q1 2025 was $0.14, compared to $0.07 in Q1 2024[99] Assets and Liabilities - Total current assets increased to $742.7 million as of March 31, 2025, compared to $731.5 million at the end of 2024[17] - Total liabilities rose to $1,662.5 million as of March 31, 2025, up from $1,622.3 million at the end of 2024[17] - Cash and cash equivalents increased to $134.6 million at the end of Q1 2025, compared to $74.1 million at the end of 2024[17] - As of March 31, 2025, total debt increased to $936.5 million from $839.7 million as of December 31, 2024, representing an increase of approximately 11.5%[45] - The company’s long-term debt, net of current portion, increased to $897.8 million as of March 31, 2025, from $783.3 million as of December 31, 2024[45] Acquisitions and Investments - The company incurred $10.1 million in costs related to acquisitions during Q1 2025[24] - The company completed the acquisition of Buro Seating Limited Partnership for AU$16.2 million (US$10.1 million) on February 28, 2025, expanding its presence in Australia and New Zealand[41] - Cash used in investing activities included $10.1 million for the acquisition of Buro Seating and capital expenditures[185] Stock and Shareholder Actions - The company repurchased $15.0 million of common stock during Q1 2025[24] - During Q1 2025, the company repurchased and retired 3.2 million shares under its stock repurchase program[101] - The company repurchased a total of 3,205,344 shares during the quarter at an average price of $4.68 per share, with approximately $75.6 million remaining under the share repurchase authorization[204] Segment Performance - The Americas segment reported net sales of $173.9 million in Q1 2025, down from $197.2 million in Q1 2024, while the International segment saw a decline from $161.7 million to $143.5 million[138] - For the three months ended March 31, 2025, net sales decreased by $41.5 million, or 11.6%, driven by lower volume and adverse foreign exchange impacts[158] - Comparable sales for the same period were $329.1 million, reflecting a decrease of $29.8 million or 8.3%[190] Cost and Expense Management - Stock-based compensation expense for the three months ended March 31, 2025, was $7.8 million, compared to $5.1 million for the same period in 2024[45] - The company recorded a net restructuring expense of $2.3 million for Q1 2025, primarily for severance and costs related to footprint rationalization[82] - The company anticipates annualized pre-tax cost savings of approximately $100.0 million by the end of 2026 from its multi-year restructuring program[179] Foreign Exchange and Derivatives - The company recognized a loss of $0.6 million in AOCI for cash flow hedges related to foreign exchange contracts for the three months ended March 31, 2025, compared to a gain of $1.0 million for the same period in 2024[111] - The fair value of derivative assets decreased from $13.3 million on December 31, 2024, to $3.6 million on March 31, 2025, while derivative liabilities decreased from $9.3 million to $2.7 million in the same period[116] - The company had foreign exchange contracts outstanding with a notional value of $47.2 million as of March 31, 2025, which were not designated as hedges[108] Legal and Regulatory Matters - Management believes that the resolution of ongoing legal proceedings, aside from the Brazil Tax Assessments, will not materially affect financial condition or results[198] - The company continues to monitor trade policies and tariffs, which have adversely impacted business and operating results, particularly concerning products sourced from China and Vietnam[202] Miscellaneous - The company is evaluating the impact of recent accounting standards on its financial disclosures, including ASU 2024-03 and ASU 2023-09[35][36] - The company’s disclosure controls and procedures were deemed effective as of March 31, 2025[195] - There were no changes in internal control over financial reporting that materially affected the company during the quarter[196]