Restructuring and Cost Management - The company announced a multi-year restructuring and cost savings program, targeting annualized pre-tax cost savings of approximately $100 million by the end of 2026, an increase of $40 million from previous estimates[79]. - Existing borrowing arrangements limit the company's ability to engage in certain activities, potentially affecting long-term interests and financial condition[97]. - Debt service obligations reduce available cash flow for working capital, capital expenditures, and research and product development efforts[98]. - The company may not continue to pay dividends at historic rates or engage in stock repurchases due to various factors, including financial condition and debt agreement terms[100]. Financial Liabilities and Impairments - As of December 31, 2024, the company recorded $121.2 million in pension liabilities on its Consolidated Balance Sheet, which could increase due to market volatility and regulatory changes[69]. - The company recorded a non-cash impairment charge of $165.2 million related to goodwill and an indefinite-lived trade name during Q2 2024, following a previous charge of $89.5 million in Q4 2023[71]. Market Challenges and Competition - The company faces challenges from increased competition, particularly from private label brands and price competition, which could adversely affect sales and margins[58]. - The company expects continued declines in demand for traditional paper-based products, which have been negatively impacted by the rise of technology-based tools and the COVID-19 pandemic[65]. Supply Chain and Operational Risks - The company relies on international suppliers and has experienced disruptions in its global supply chain, which could impact operations and profitability[80]. - Disruptions in the global supply chain due to external factors could materially affect the company's operations and financial results[123]. - Operating results have been adversely affected by inflation and changes in the cost or availability of raw materials, transportation, labor, and other necessary supplies[81]. - Outsourcing product development and manufacturing creates risks such as cost overruns, delayed deliveries, and inferior product quality, which could adversely affect business operations[84]. - The company relies on third-party service providers for information technology systems, which poses risks similar to those associated with product production outsourcing[85]. Innovation and Product Development - The company’s success is contingent on its ability to innovate and develop new products that meet changing consumer demands, which is critical for long-term growth[61]. - The company’s inventory and working capital needs fluctuate significantly due to seasonal demand, complicating forecasting and operational planning[66]. Taxation and Regulatory Risks - The company faces risks of increased future taxation on earnings due to global operations and changes in tax legislation[107]. - The Brazil Tax Assessments could materially adversely affect cash flow if the initial position is sustained[106]. - Potential legislative changes in multinational corporate taxation could significantly impact the company's performance[109]. - Unanticipated tax consequences may adversely affect the company's business results[110]. - Compliance with complex and frequently changing laws and regulations could materially affect the company's operations and financial condition[111]. - Increased operating and compliance costs due to evolving environmental and sustainability laws may adversely impact the company's financial results[112]. Trade and Economic Factors - Changes in U.S. trade policy and tariffs could negatively affect the company's supply chain and operating costs[116]. - Retaliatory tariffs and trade wars may diminish customer demand and adversely affect sales and gross margins[117]. - Adverse economic conditions and political instability in operating markets may negatively impact consumer confidence and sales[124]. Workforce and Human Resources - The company's ability to attract and retain qualified personnel is critical for maintaining a diverse workforce and implementing business strategy[120]. Stock Price and Financial Condition - Historical volatility in the company's stock price may impact financing opportunities and overall financial condition[121].

Financial Data and Key Metrics Changes - Full-year sales and adjusted EPS were in line with the company's outlook, despite greater-than-expected foreign currency headwinds [9] - Free cash flow for the year was $132 million, consistent with expectations [9] - Net debt decreased by $94 million for the year, improving the company's financial position [10][32] - Gross profit for Q4 was $156 million, a decrease of 9% compared to the prior year, but full-year gross margins expanded by 70 basis points [26][27] Business Line Data and Key Metrics Changes - Reported sales in Q4 decreased by 8%, with comparable sales down 6% excluding foreign exchange impacts [24] - In the Americas segment, sales declined by 12%, with comparable sales down 8% [28] - The international segment saw comparable sales decline by 3%, though technology accessories experienced growth [30] Market Data and Key Metrics Changes - The overall demand environment remained soft, with discretionary spending constrained [22] - Sales trends in Q4 were better than the first half of the year, indicating some recovery [22] - The company anticipates that sales in 2025 will be flat but improving throughout the year [19] Company Strategy and Development Direction - The company is focusing on restoring sales growth through new product development, accretive acquisitions, and brand building [15] - A $60 million multiyear cost reduction program was implemented, with an expanded target of $100 million in total savings by the end of 2026 [12][13] - The company is committed to investments in leading brands and has maintained or grown market share in many categories [17] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging operating environment and the need for additional cost savings due to volume declines and uncertainties [22][35] - The outlook for 2025 includes expectations for comparable sales to decline by 1% to 5%, with a more consistent demand environment anticipated as the year progresses [35] - Management expressed confidence in the company's ability to navigate tariffs and foreign exchange impacts through a balanced supply chain [78] Other Important Information - The company refinanced its bank credit facilities, extending maturity dates to 2029 [11] - Free cash flow is expected to normalize in 2025, with a range of $105 million to $115 million anticipated [38] - The company returned $15 million to shareholders through share repurchases and $28 million for dividends [34] Q&A Session Summary Question: What is different this time regarding sales trajectory? - Management indicated that growth will primarily come from share gains and emphasized the need to expand into adjacent categories [46][49] Question: Update on gaming partnerships? - Management reported strong performance in gaming for 2024, driven by new product introductions and international expansion, particularly in Japan [51][53] Question: Retailers' inventory positions for back-to-school? - Management anticipates that retailers will be conservative with inventory, similar to the previous year [57] Question: Timing of cost savings? - Management expects $25 million in savings for the current year, with $40 million anticipated for the next year [61] Question: M&A focus? - Management is looking for low-risk, highly accretive M&A opportunities, focusing on near-adjacent categories [62][63] Question: Changes in Brazil's market outlook? - Management noted modestly improving trends in Brazil but acknowledged competitive pricing pressures [70] Question: Currency impact on sales outlook? - Management clarified that comparable sales exclude foreign exchange impacts, which are expected to be a significant headwind [75] Question: Tariff scenario planning? - Management emphasized a balanced supply chain and proactive pricing strategies to mitigate tariff impacts [78] Question: Acquisition pipeline? - Management is focused on synergistic acquisitions that align with strategic goals while maintaining a disciplined approach to leverage [82][93]

Core Viewpoint - Acco Brands reported quarterly earnings of $0.39 per share, missing the Zacks Consensus Estimate of $0.41 per share, indicating a slight decline in performance compared to the previous year [1] Financial Performance - The company posted revenues of $448.1 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 1.53% and down from $488.6 million year-over-year [2] - Over the last four quarters, Acco has surpassed consensus EPS estimates two times and topped consensus revenue estimates just once [2] Stock Performance - Acco shares have increased approximately 5.9% since the beginning of the year, outperforming the S&P 500's gain of 4.5% [3] - The stock's immediate price movement will largely depend on management's commentary during the earnings call [3] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.06 on revenues of $362.8 million, and for the current fiscal year, it is $1.13 on revenues of $1.69 billion [7] - The estimate revisions trend for Acco is mixed, resulting in a Zacks Rank 3 (Hold), suggesting the stock is expected to perform in line with the market in the near future [6] Industry Context - The Office Supplies industry, to which Acco belongs, is currently in the bottom 3% of over 250 Zacks industries, indicating potential challenges ahead [8]

Sales Performance - Reported net sales for 2024 were $1.67 billion, a decrease of 9.1% from $1.83 billion in 2023, with adverse foreign exchange impacting sales by $19.3 million, or 1.1%[9] - Fourth quarter net sales were $448.1 million, down 8.3% from $488.6 million in 2023, with comparable sales decreasing by 5.9%[6] - Net sales for Q4 2024 decreased by 8.3% to $448.1 million compared to $488.6 million in Q4 2023, and for the full year, net sales decreased by 9.1% to $1,666.2 million from $1,832.8 million[35] - ACCO Brands Americas reported a net sales decline of 14.3% in Q1 2024, with a $32.8 million decrease[65] - ACCO Brands International experienced a 6.3% drop in net sales in Q1 2024, resulting in a $10.9 million decrease[65] - Total net sales for ACCO Brands decreased by 10.9% in Q1 2024, amounting to a $43.7 million decline[65] - In Q2 2024, ACCO Brands Americas saw a 13.1% decline in net sales, translating to a $44.1 million decrease[65] - ACCO Brands International's net sales fell by 7.1% in Q2 2024, with a $11.2 million decrease[65] - Total net sales for ACCO Brands in Q2 2024 decreased by 11.2%, resulting in a $55.3 million decline[65] - ACCO Brands Americas reported an 8.9% decline in net sales in Q3 2024, with a $25.3 million decrease[65] - In Q4 2024, ACCO Brands Americas experienced an 11.8% decline in net sales, resulting in a $33.6 million decrease[65] - For the year-to-date 2024, ACCO Brands Americas reported a 12.0% decline in net sales, amounting to a $135.8 million decrease[65] - Total net sales for ACCO Brands year-to-date 2024 decreased by 9.1%, resulting in a $166.6 million decline[65] Financial Performance - Net income for 2024 was $20.6 million, or $0.21 per share, compared to a net loss of $59.4 million, or $(0.62) per share in 2023[8] - Adjusted EPS for 2024 was $1.02, reflecting unfavorable foreign exchange trends, compared to $1.09 in 2023[12] - The company expects comparable sales to decline between 1.0% to 5.0% for 2025, with adjusted EPS projected to be in the range of $1.00 to $1.05[22] - Net loss for the full year 2024 was $101.6 million, compared to a loss of $21.8 million in 2023, reflecting a substantial decline in profitability[38] - The reported GAAP net loss for the twelve months ended December 31, 2024, was $(101.6) million, with a diluted loss per share of $(1.06)[54] - Adjusted net income per diluted share for the three months ended December 31, 2024, was $0.39, compared to $0.39 for the same period in 2023[51] Cash Flow and Cost Management - Free cash flow for 2024 was $132.3 million, an increase from $114.9 million in the prior year[13] - Cash and cash equivalents increased to $74.1 million at the end of 2024 from $66.4 million at the end of 2023, reflecting positive cash flow from operating activities[37] - Free Cash Flow for Q4 2024 was $45.4 million, compared to $53.9 million in Q4 2023, reflecting a decline of 15.7%[61] - Net cash provided by operating activities for the year ended December 31, 2024, increased to $148.2 million from $128.7 million in 2023, marking a growth of 15.3%[61] - The company realized approximately $25 million in cost savings during 2024, with an additional $100 million in cumulative savings expected from a multi-year cost reduction program[4][15] - Stock-based compensation decreased to $11.9 million for the year ended December 31, 2024, down from $14.8 million in 2023, a reduction of 19.6%[59] - Interest expense, net, decreased to $45.1 million for the year ended December 31, 2024, from $51.5 million in 2023, a decrease of 11.8%[59] Asset and Liability Management - The consolidated leverage ratio as of December 31, 2024, was 3.4x, with net debt reduced by $94 million[13] - Total assets decreased to $2,228.4 million in 2024 from $2,644.8 million in 2023, primarily due to reductions in goodwill and identifiable intangibles[33] - Total liabilities decreased to $1,622.3 million in 2024 from $1,857.8 million in 2023, indicating improved financial leverage[33] Operational Efficiency - Gross profit margin for Q4 2024 was 34.7%, slightly down from 34.8% in Q4 2023, while the full year gross profit margin improved to 33.3% from 32.6%[36] - Operating income for Q4 2024 was $42.0 million, a significant recovery from a loss of $52.8 million in Q4 2023, while the full year operating loss was $37.0 million compared to a profit of $44.7 million in 2023[35] - Restructuring costs decreased by 48.8% in Q4 2024 to $10.7 million from $20.9 million in Q4 2023, indicating improved operational efficiency[35] - Restructuring costs for the twelve months ended December 31, 2024, amounted to $16.8 million[54] Impairment Charges - The company reported a significant non-cash charge for impairment of goodwill and intangible assets of $165.2 million for the full year 2024, compared to $89.5 million in 2023[38] - The company reported a goodwill impairment charge of $127.5 million for the twelve months ended December 31, 2024[54] - The company reported an impairment of goodwill and intangible assets of $165.2 million for the year ended December 31, 2024, compared to $89.5 million in 2023, indicating a significant increase[59] Future Outlook - The company anticipates first quarter adjusted loss per share to be in the range of ($0.03) to ($0.05) due to fixed cost deleveraging[21] - The company plans to continue its capital allocation strategy, including debt reduction, dividend payments, and opportunistic share repurchases[21] - The company anticipates a full-year non-GAAP estimated annual tax rate of 30.0% as of December 31, 2024[56] - Adjusted EBITDA for the twelve months ended December 31, 2024, was $42.5 million, or 30.0% of net income[54] - Adjusted EBITDA for the year ended December 31, 2024, was $228.3 million, down from $250.5 million in 2023, representing a decrease of 8.8%[59] - Adjusted EBITDA as a percentage of net sales for the year ended December 31, 2024, remained stable at 13.7%[59]

Group 1 - The article highlights ACCO Brands Corporation as a cheap investment opportunity for value investors [1] - The focus of Crude Value Insights is on cash flow and companies in the oil and natural gas sector, emphasizing value and growth prospects [1] - Subscribers to the service gain access to a stock model account, cash flow analyses of exploration and production firms, and live discussions about the sector [2] Group 2 - A two-week free trial is offered for new subscribers to explore the oil and gas investment opportunities [3]

Group 1 - The author has over 15 years of investment experience, focusing on mid-sized hedge funds with assets between $100 million and $500 million [1] - The investment strategy includes medium-term investing in ideas with catalysts for value unlocking and short selling in case of downside catalysts [1] - The author has a preference for growth stories available at reasonable prices, with a background in analyzing industrial, consumer, and technology sectors [1] Group 2 - There is no current stock, option, or derivative position in the companies mentioned, but a potential long position may be initiated in ACCO and SCS within the next 72 hours [2] - The article expresses the author's own opinions and is not compensated for it, aside from Seeking Alpha [2] - Seeking Alpha does not guarantee past performance as an indicator of future results and does not provide specific investment recommendations [3]

Financial Data and Key Metrics Changes - The company reported a 6% decrease in reported sales for Q3 2024 compared to the prior year, with comparable sales down 5% excluding foreign exchange impacts [24][21] - Gross profit for Q3 was $137 million, a decrease of 6% due to lower sales, while SG&A expenses were reduced by 7% year-over-year [25][22] - The adjusted operating income for Q3 was $45 million, slightly below last year, but with a 30 basis points improvement in adjusted operating margin [25] Business Line Data and Key Metrics Changes - In the Americas segment, sales declined by 9%, with comparable sales down 7%, impacted by the exit of lower-margin business and weaker Back-to-School replenishment [26] - The International segment saw a 2% decline in comparable sales, though growth in Technology Accessories helped mitigate losses [28] - Technology Accessories, including Computer and Gaming accessories, experienced growth for the second consecutive quarter, indicating a positive trend [16][60] Market Data and Key Metrics Changes - The Back-to-School season in North America was down year-over-year, with retailers adopting a more conservative approach to inventory levels [12][13] - In Brazil, the Back-to-School market sales were softer than anticipated, with later customer orders compared to the previous year [14] - EMEA and Asia regions had strong performance driven by new product introductions and improved customer engagement [15] Company Strategy and Development Direction - The company is focused on a multi-year cost reduction program aiming for over $20 million in savings, enhancing operational efficiency and long-term profitability [7][8] - There is a commitment to a balanced capital allocation strategy, including dividends, share repurchases, and debt reduction [9][31] - The company is exploring opportunities for M&A, focusing on synergistic categories that provide strong financial returns [79][80] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about revenue trends, noting valuable insights gained from the Back-to-School season [17][19] - The demand environment remains muted, particularly in traditional office products, due to changes in work dynamics and digitalization [46][48] - The company expects reported sales for the full year to decline between 8% to 9%, with adjusted EPS projected between $1.04 to $1.09 [32] Other Important Information - The company successfully refinanced its credit facilities, extending the maturity date from 2026 to 2029, enhancing financial flexibility [10][23] - Free cash flow improved by $26 million year-over-year, with expectations to reach approximately $130 million for the year [29][30] Q&A Session Summary Question: Dynamics in Brazil and Mexico - Management noted that the slowdown in Brazil and Mexico is more related to local issues rather than secular trends, with a focus on monitoring the situation closely [35][36] Question: Demand Environment - The muted demand is attributed to changes in work patterns and an acceleration in digitalization, impacting traditional office product categories [46][48] Question: Cost Savings in 2025 - The company is evaluating opportunities for additional cost savings beyond the ongoing productivity program [72][73] Question: M&A Interest - There is increased interest in M&A, with a focus on synergistic opportunities that provide strong financial returns [78][79] Question: Back-to-School Inventory Levels - Inventory levels are better positioned than last year, which could contribute to improved sell-in for the next Back-to-School season [77] Question: Product Development Pipeline - The company is actively assessing its product development efforts to adapt to changing market dynamics and improve revenue outcomes [64][66]

Financial Performance - Net sales for Q3 2024 were $420.9 million, a decrease of 6.3% from $448.0 million in Q3 2023[11]. - Gross profit for Q3 2024 was $136.9 million, down from $144.8 million in Q3 2023, reflecting a gross margin of 32.5%[11]. - Net income for Q3 2024 was $9.3 million, compared to $14.9 million in Q3 2023, resulting in basic income per share of $0.10[11][12]. - Operating income for Q3 2024 was $26.3 million, down from $32.2 million in Q3 2023, reflecting ongoing operational challenges[11]. - For the nine months ended September 30, 2024, net sales totaled $1,218.1 million, down from $1,344.2 million in the same period of 2023, reflecting a decrease of 9.4%[103]. - The company reported a net loss of $125.2 million for the quarter ended March 31, 2024, compared to a net loss of $6.3 million for the previous quarter[16]. - The net loss for the nine months ended September 30, 2024, was $122.2 million, compared to a net income of $37.6 million in the prior year, primarily due to non-cash impairment charges[139]. Assets and Liabilities - Total assets decreased to $2,357.5 million as of September 30, 2024, down from $2,644.8 million at the end of 2023[9]. - Total liabilities reduced to $1,742.0 million from $1,857.8 million, indicating a decrease of approximately 6.2%[9]. - As of September 30, 2024, the total stockholders' equity was $615.5 million, a decrease from $758.5 million at March 31, 2024[16]. - As of September 30, 2024, total debt amounted to $914.4 million, a decrease from $925.6 million as of December 31, 2023[30]. - The total deficit increased to $700.7 million as of September 30, 2024, compared to $569.7 million at March 31, 2024[16]. Cash Flow and Liquidity - Cash and cash equivalents increased to $102.0 million from $66.4 million, representing a significant improvement in liquidity[9][14]. - The company experienced a net cash provided by operating activities of $95.5 million for the nine months ended September 30, 2024, compared to $70.7 million in the same period of 2023[14]. - Operating cash flow for the first nine months of 2024 was $95.5 million, up from $70.7 million in the prior year, reflecting reductions in working capital[125]. - As of September 30, 2024, the company had $102.0 million in cash on hand and $22.5 million in borrowings outstanding under the Revolving Facility[150]. Impairment and Restructuring - The company reported a non-cash charge for impairment of goodwill and intangible assets amounting to $165.2 million for the nine months ended September 30, 2024[11][14]. - Goodwill impairment of $127.5 million was recorded for the Americas reporting unit as of May 31, 2024, due to a decline in forecasted cash flows and stock price[52]. - The company recorded net restructuring expenses of $6.7 million and $6.1 million for the three and nine months ended September 30, 2024, primarily for severance costs related to cost reduction initiatives[64]. Shareholder Actions - The company repurchased and retired 2.4 million shares during the three and nine months ended September 30, 2024, while no shares were repurchased during the same periods in 2023[80]. - The company has approximately $93,179,856 remaining under its share repurchase program, which is authorized up to $200 million[174]. - The company purchased a total of 2,440,341 shares during the quarter ended September 30, 2024, at an average price of $5.11 per share[174]. Segment Performance - The Americas segment reported net sales of $259.1 million for the three months ended September 30, 2024, down from $284.4 million in 2023, representing a decline of 8.5%[108]. - The International segment generated net sales of $161.8 million for the three months ended September 30, 2024, slightly down from $163.6 million in 2023, a decrease of 1.1%[108]. - The net sales in Latin America for the three months ended September 30, 2024, were $45.6 million, down from $64.1 million in 2023, a decline of 28.5%[102]. Future Outlook - The company plans to focus on market expansion and new product development to drive future growth[11]. - The company expects continued impact from softer global demand due to macroeconomic conditions and geopolitical uncertainties[123]. - The company anticipates that the collective global trends will continue to affect financial results moving forward[123]. Legal and Compliance - The company is involved in various lawsuits, including patent infringement claims, which could potentially impact financial condition[117]. - The company is currently facing income tax assessments against its Brazilian subsidiary, ACCO Brands Brasil Ltda.[171]. - The company has filed various certifications in compliance with the Sarbanes-Oxley Act of 2002[177].

Core Insights - Acco Brands (ACCO) reported quarterly earnings of $0.23 per share, matching the Zacks Consensus Estimate, but down from $0.24 per share a year ago [1] - The company achieved revenues of $420.9 million for the quarter ended September 2024, exceeding the Zacks Consensus Estimate by 0.64%, but down from $448 million year-over-year [2] - Acco shares have declined approximately 18.3% year-to-date, contrasting with the S&P 500's gain of 21.9% [3] Earnings Performance - The company has surpassed consensus EPS estimates three times over the last four quarters [1] - Acco has topped consensus revenue estimates two times in the last four quarters [2] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.41 on revenues of $458.66 million, and for the current fiscal year, it is $1.04 on revenues of $1.67 billion [7] - The estimate revisions trend for Acco is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Office Supplies industry, to which Acco belongs, is currently ranked in the bottom 9% of over 250 Zacks industries, suggesting potential challenges ahead [8]

Loan Amendments and Credit Agreements - The amendment provides Term A Loans in an aggregate principal amount of €122,890,001.85 to refinance all existing Euro Term A Loans[2] - The aggregate outstanding principal amount of Euro Term A Loans is €122,890,001.85[7] - The aggregate principal amount of Revolving Credit Commitments is $467,500,000[7] - Existing Euro Term A Lenders must deliver their consent by 12:00 p.m. on October 29, 2024, to avoid being deemed Non-Continuing Euro Term A Lenders[5] - Existing Revolving Credit Lenders must also deliver their consent by the same deadline to avoid similar consequences[5] - The amendment replaces the CDOR Rate with Term CORRA[2] - Each Existing Euro Term A Lender that does not consent will sell their Existing Euro Term A Loans at 100% of par[11] - The amendment allows for the continuation of Existing Revolving Credit Loans and Commitments under the new terms[9] - The amendment is part of a series of modifications to the Credit Agreement dating back to January 27, 2017[1] - The Administrative Agent and Borrowers have agreed to the terms of the amendment as outlined in the document[6] - Existing Revolving Credit Lenders consenting to Option A will sell their entire aggregate principal amount of Existing Revolving Credit Loans at 100% of par on the Seventh Amendment Closing Date[14] - Non-Continuing Revolving Credit Lenders opting for Option B will sell their Existing Revolving Credit Loans at 100% of par as specified in the applicable Master Assignment[15] - Any Revolving Credit Lender failing to execute the consent by 12:00 p.m. on October 29, 2024, will be deemed a Non-Continuing Revolving Credit Lender and will sell their Existing Revolving Credit Loans at 100% of par[16] - The Master Assignment Agreements will facilitate the sale and assignment of Existing Euro Term A Loans and Existing Revolving Credit Loans as set forth in Schedule I[17] - The Seventh Amendment will become effective upon the execution of the Amendment by all required parties, including Holdings and the Administrative Agent[22] - The Borrowers must repay all outstanding Australian Dollar and U.S. Dollar Term A Loans along with accrued interest and fees by the Seventh Amendment Closing Date[26] - The Administrative Agent must receive all necessary documentation and approvals from Governmental Authorities prior to the Seventh Amendment Closing Date[25] - The representations and warranties in the Amended Credit Agreement must be true and correct in all material respects as of the Seventh Amendment Closing Date[32] - No Default or Event of Default should exist after giving effect to this Amendment[34] - As of the Seventh Amendment Closing Date, the representations and warranties in the Amended Credit Agreement are confirmed to be true and correct in all material respects[41] - No events have occurred that would constitute an Event of Default or a Default as a result of the transactions contemplated by this Amendment[42] - The U.S. Mortgages on specific real properties located at 101 O'Neil Road, Sidney, NY and 949 Main Street, Alexandria, PA will be released as of the Seventh Amendment Closing Date[45] - Each Loan Party is required to execute and deliver additional documents as specified in Schedule 2 within the designated time limits[46] - The terms of the Amended Credit Agreement and other Loan Documents remain unchanged and in full force and effect, except as specifically amended[53] - The execution and delivery of this Amendment do not constitute a waiver of any rights under the Amended Credit Agreement or other Loan Documents[53] - The Administrative Agent is authorized to determine and complete all amounts and percentages related to the Commitments and Loans of each Lender[60] - The Amendment may be executed in multiple counterparts, including electronic signatures, which will be considered original[58] - The Amendment does not constitute a novation but rather an amendment of pre-existing Indebtedness[59] - The Seventh Amendment was executed on October 30, 2024, following several prior amendments to the Credit Agreement[65] Financial Performance and Projections - The company reported a revenue of $2.5 billion for the last quarter, representing a 15% increase year-over-year[68] - User data showed a growth of 1.2 million active users, bringing the total to 25 million, a 5% increase from the previous quarter[69] - The company provided guidance for the next quarter, expecting revenue to be between $2.6 billion and $2.8 billion, indicating a growth rate of 8% to 12%[70] - New product launches are anticipated to contribute an additional $300 million in revenue over the next fiscal year[71] - The company is investing $150 million in research and development for new technologies aimed at enhancing user experience[72] - Market expansion efforts include entering three new countries, projected to increase user base by 10%[73] - The company completed a strategic acquisition of a smaller competitor for $500 million, expected to enhance market share by 3%[74] - Cost reduction strategies implemented have resulted in a 5% decrease in operational expenses, saving approximately $100 million annually[75] - The company plans to increase its marketing budget by 20% to support new product launches and market expansion[76] - A new partnership with a leading tech firm is expected to drive innovation and improve service delivery, potentially increasing revenue by 7%[77] - The company reported a significant increase in revenue, reaching $1.5 billion, representing a 20% year-over-year growth[1] - User data showed an increase in active users to 10 million, up from 8 million in the previous quarter, indicating a 25% growth[2] - The company provided guidance for the next quarter, expecting revenue to be between $1.6 billion and $1.7 billion, which translates to a growth rate of 7% to 13%[3] - New product launches are anticipated to contribute an additional $200 million in revenue over the next fiscal year[4] - The company is investing $50 million in R&D for new technologies aimed at enhancing user experience and product efficiency[5] - Market expansion plans include entering three new countries, projected to increase market share by 15%[6] - The company is considering strategic acquisitions to bolster its product offerings, with a budget of $100 million allocated for potential deals[7] - Customer retention rates improved to 85%, up from 80% in the previous quarter, reflecting enhanced customer satisfaction[8] - The company reported a decrease in operational costs by 10%, resulting in improved profit margins[9] - Future outlook remains positive, with a focus on sustainable growth and innovation in product development[10] Loan and Financial Structure - ACCO Brands Corporation has an aggregate principal amount of $770 million in Term Loans and $250 million in Revolving Credit Loans outstanding under the Original Credit Agreement[84] - The 2029 Notes have a 4.25% interest rate and an aggregate principal amount not to exceed $575 million[90] - The company has established a tranche of Euro-denominated Term A Loans as part of its financing strategy[87] - The acquisition of 100% of the Equity Interests of Esselte Group Holdings AB is part of the company's growth strategy[90] - The Third Amended and Restated Credit Agreement was entered into on January 27, 2017, reflecting the repayment of existing Term A Loans[85] - The company continues to maintain its Revolving Credit Facility, which has been amended and restated[87] - The total commitments from lenders under the Aggregate Commitments are significant, supporting the company's financial flexibility[94] - The company has made additional Term A Loans available as part of its financing arrangements[85] - The Administrative Agent for the credit agreements is Bank of America, N.A., ensuring effective management of the loan documents[89] - The company has engaged in various amendments to its credit agreements to optimize its capital structure and financing terms[85] - The aggregate amount of the Australian Dollar Term A Commitments is AUD $61,000,000 as of the Second Amendment Closing Date[120] - The Alternative Currency Sublimit is set at $300,000,000, which is part of the Revolving Credit Commitments[100] - The Applicable Rate for Term A Facilities and the Revolving Credit Facility is determined by the Consolidated Leverage Ratio, with Pricing Level 1 applying if a Compliance Certificate is not delivered on time[106] - The All-in Yield for any Indebtedness is calculated considering interest rate, margin, original issue discount, and up-front fees[98] - The Agreed Currency Rate Loan includes both Revolving Credit Loans and Term Loans based on the Agreed Currency Rate[97] - The Australian Base Rate is determined by the Reserve Bank of Australia and is subject to change based on market conditions[115] - The Applicable Percentage for any Term A Lender is calculated based on the aggregate principal amount of all Term A Loans outstanding[104] - The pricing levels for the Consolidated Leverage Ratio range from 1.25% to 2.50% for various levels of leverage[107] - The definition of "Alternative Currency" includes currencies such as Canadian Dollars, Euros, and Australian Dollars, which are convertible into U.S. Dollars[99] - The term "Applicable Indebtedness" relates to the Weighted Average Life to Maturity, impacting financial assessments[103] - The aggregate outstanding principal amount of Australian Dollar Term A Loans is AUD $61,000,000[122] - The Base Rate is determined as the greatest of the Prime Rate, the Federal Funds Effective Rate plus 0.5%, or the Term SOFR plus 1.0%[127] Compliance and Documentation - The Cash Management Agreement includes services such as treasury, depository, and electronic funds transfer[145] - The definition of Cash Equivalents includes investments in marketable obligations and time deposits with a minimum capital of $1,000,000,000[144] - The term "Bail-In Action" refers to the exercise of Write-Down and Conversion Powers by the applicable Resolution Authority[125] - The term "Borrowing" encompasses various types of credit facilities including Revolving Credit Borrowing and Term A Borrowing[133] - The Canadian BA Rate is based on the average rate applicable to Canadian Dollar bankers' acceptances[137] - The definition of "Change in Law" includes the adoption of new laws or changes in existing laws affecting the agreement[149] - The term "Business Day" excludes weekends and legal holidays in New York[134] - The term "Capital Expenditures" refers to expenditures for the acquisition or maintenance of fixed or capital assets[140] - The definition of "Change of Control" includes scenarios where a person or group acquires 35% or more of the equity securities of Holdings[150] - Holdings must maintain ownership and control of all economic and voting rights associated with the equity interests of any Borrower[150] - A majority of the board of directors must consist of individuals who were members at the start of a 12-month period, or whose election was approved by such members[151] - Any event classified as a "Change of Control" under relevant debt documents may allow holders of indebtedness to accelerate maturity or require repayment[151] - The term "Collateral" encompasses all pledged collateral and mortgaged property as defined in the Collateral Documents[153] - The Administrative Agent requires various compliance documents from U.S. Guarantors and Foreign Borrowers after the Restatement Date[155] - All indebtedness of Holdings and its subsidiaries must be evidenced by intercompany notes or promissory notes, with specific conditions for pledging[157] - The Administrative Agent must receive estoppels from lessors of leased properties valued at $1 million or more[157] - U.S. Mortgages must be executed for properties with a fair market value greater than $1 million, securing all obligations[157] - The company must ensure that all filing and recording taxes and fees related to U.S. Mortgages are paid[157] - The company reported a consolidated cash interest expense for the most recently completed measurement period, net of cash interest income, excluding any upfront and one-time financing fees[169] - The commitment fee rate is set at 0.375% from the Fifth Amendment Closing Date until the first fiscal quarter compliance certificate is delivered, with adjustments based on the consolidated leverage ratio thereafter[163] - The consolidated current assets exclude cash and cash equivalents, any asset related to the specified Brazilian tax payment, and deferred income taxes[170] - The consolidated current liabilities exclude deferred income taxes, any liability related to the specified Brazilian tax payment, and the current portion of long-term debt[171] - The company is required to provide evidence of insurance for U.S. mortgaged properties as part of the collateral documentation[160] - The administrative agent may grant extensions for the perfection of security interests or obtaining title insurance if undue effort or expense is determined[161] - The company must furnish a description of any acquired U.S. mortgaged property within 10 days and execute necessary documents within 60 days[161] - The company is required to deliver engineering, soils, and environmental assessment reports for U.S. mortgaged properties from professional firms acceptable to the administrative agent[160] - The company must provide completed flood hazard determination forms and evidence of flood insurance if applicable[160] - The administrative agent requires customary documentation including estoppels, confirmations, and favorable legal opinions to ensure enforceability of the collateral documents[161] Financial Metrics and Ratios - Consolidated EBITDA for the most recently completed Measurement Period includes adjustments for interest expense, taxes, depreciation, and non-recurring expenses[172] - The Consolidated Leverage Ratio is calculated as the ratio of Consolidated Funded Indebtedness to Consolidated EBITDA, with specific exclusions for Unrestricted Cash[178] - Consolidated Net Income excludes extraordinary gains and non-cash losses, with a cap on the increase from net income of non-subsidiaries set at $10 million per Measurement Period[179] - The maximum allowable cost savings adjustments in any four consecutive fiscal quarters shall not exceed 10% of Consolidated EBITDA prior to such adjustments[174] - Consolidated Interest Coverage Ratio is defined as the ratio of Consolidated EBITDA to Consolidated Cash Interest Expense for the most recently completed Measurement Period[177] - Consolidated Funded Indebtedness includes all obligations for borrowed money, purchase money indebtedness, and certain guarantees, excluding obligations under Permitted Supply Chain Financing[175] - Non-cash charges related to stock-based compensation are included in the calculation of Consolidated EBITDA[172] - The definition of Pro Forma Basis allows for adjustments related to Permitted Acquisitions, including projected cost savings and operating improvements[174] - The total assets of Holdings and its Subsidiaries are determined in accordance with GAAP and reflect pro forma effects of acquisitions or dispositions[180] - The company incurred cash charges related to severance and restructuring costs, capped at 15% of Consolidated EBITDA for the Measurement Period[172]