Donnelley Financial Solutions(US:DFIN)2021-08-03 16:00Financial Performance - Total net sales for Q2 2021 reached $267.5 million, a 5.5% increase from $254.0 million in Q2 2020[15] - Net earnings for Q2 2021 were $42.9 million, compared to a net loss of $1.3 million in Q2 2020, marking a significant turnaround[15] - The company reported net earnings for the six months ended June 30, 2021, were $78.1 million, a significant increase from $2.8 million in the same period of 2020[25] - Basic earnings per share for the three months ended June 30, 2021, was $1.27, compared to a loss of $0.04 per share in the same period of 2020[90] - The company reported a basic earnings per share of $2.32 for the six months ended June 30, 2021, compared to $0.08 for the same period in 2020[17] Revenue Growth - The company reported a 27.5% increase in Tech-enabled services sales, from $115.4 million in Q2 2020 to $134.0 million in Q2 2021[15] - Software solutions sales increased by 39.9%, from $47.6 million in Q2 2020 to $66.6 million in Q2 2021[15] - DFIN reported total net sales of $267.5 million for the three months ended June 30, 2021, compared to $254.0 million for the same period in 2020, representing a year-over-year increase of approximately 5.9%[51] - The company's software solutions generated $66.6 million in revenue for the three months ended June 30, 2021, up from $47.6 million in the same period of 2020, reflecting a growth of approximately 39.9%[51] - DFIN's tech-enabled services contributed $134.0 million to total net sales for the three months ended June 30, 2021, compared to $115.4 million in the prior year, marking an increase of about 16.9%[51] Cost Management - Total cost of sales decreased by 14.6% from $137.5 million in Q2 2020 to $117.5 million in Q2 2021, improving overall profitability[15] - Total cost of sales decreased to $227.8 million for the six months ended June 30, 2021, from $273.8 million in the same period of 2020, showing improved cost management[16] - Selling, general and administrative expenses rose to $75.1 million in Q2 2021, up from $72.8 million in Q2 2020[15] - Selling, general and administrative expenses increased to $148.6 million for the six months ended June 30, 2021, compared to $129.8 million in 2020, reflecting investments in growth initiatives[16] Asset and Liability Management - The company’s total assets increased to $931.5 million as of June 30, 2021, compared to $865.6 million at the end of 2020[22] - Total liabilities decreased from $617.8 million at the end of 2020 to $611.9 million as of June 30, 2021[22] - Retained earnings increased significantly to $183.6 million as of June 30, 2021, up from $105.5 million at the end of 2020[22] - The total equity of the company increased to $319.6 million as of June 30, 2021, up from $270.4 million as of June 30, 2020, reflecting strong financial health[30] Cash Flow and Investments - The company reported net cash used in operating activities of $7.7 million for the six months ended June 30, 2021, compared to $23.9 million for the same period in 2020, indicating improved cash flow management[25] - Capital expenditures for the six months ended June 30, 2021, were $17.7 million, up from $15.7 million in the same period of 2020, reflecting ongoing investments in growth[25] - The company had cash and cash equivalents of $39.9 million at the end of the period, compared to $37.4 million at the end of June 30, 2020, showing a slight increase in liquidity[25] - The company reported a net cash used in investing activities of $17.7 million for the six months ended June 30, 2021, compared to $4.2 million in the same period of 2020, indicating increased investment activity[25] Restructuring and Impairments - For the three months ended June 30, 2021, the company recorded net restructuring charges of $2.8 million, compared to $25.1 million for the same period in 2020[65][68] - For the six months ended June 30, 2021, the company recorded net restructuring charges of $3.6 million, down from $28.2 million in the same period in 2020[67][68] - The restructuring actions in 2021 involved employee termination costs for approximately 170 employees, with all terminations expected by December 31, 2021[67] - The company recognized impairments of right-of-use (ROU) assets totaling $12.1 million for both the three and six months ended June 30, 2020[69] Pension and Contingent Liabilities - As of June 30, 2021, the company had $5.9 million accrued related to the remaining contingent liability for LSC multiemployer pension plans[77] - The total undiscounted LSC MEPP liabilities were approximately $103 million, with annual payments ranging from $1.6 million to $8.5 million through 2034[74] - The company recorded a charge of $19.0 million in 2020 for estimated payments related to the LSC MEPP liabilities[75] - The company accrued a contingent liability of $4.1 million for estimated sales tax exposures as of June 30, 2021, down from $5.2 million as of December 31, 2020[80] Comprehensive Income - The company’s accumulated other comprehensive loss decreased to $(78.9) million as of June 30, 2021, from $(80.8) million at the end of 2020, showing a positive change in comprehensive income[11] - The company recognized a net actuarial loss of $1.0 million for the three months ended June 30, 2021, and $1.9 million for the six months ended June 30, 2021[100] - The company’s total other comprehensive income for the six months ended June 30, 2021 was $2.6 million, compared to $0.5 million for the same period in 2020[98]