Quad/Graphics(US:QUAD)2023-05-04 01:55Financial Data and Key Metrics Changes - Adjusted EBITDA increased by $11 million, or 24%, in the quarter, driven by net sales growth, improved manufacturing productivity, and cost reduction initiatives [5][39] - Net sales increased by 3% in the quarter, attributed to higher product sales in the United States and Mexico, as well as increased agency solution sales [17][25] - Adjusted diluted earnings per share rose to $0.15 in Q1 2023 from $0.04 in Q1 2022, primarily due to higher adjusted net earnings and stock repurchases [26] - Net debt increased by $87 million to $632 million as of March 31, 2023, with a debt leverage ratio of 2.39x, up 23 basis points from the previous quarter [13][27] Business Line Data and Key Metrics Changes - Growth in net sales was driven by the Mexico operations, catalogs, and agency solutions offerings, despite organic declines in large-scale print [25][12] - The company continues to gain segment share in large-scale print, winning significant contracts such as Reader's Digest [12] Market Data and Key Metrics Changes - The company is focused on accelerating market penetration and gaining visibility with new brands and verticals through participation in industry events [20] - The company hosted its 23rd Postal conference, which attracted approximately 300 clients, focusing on effective print delivery [21] Company Strategy and Development Direction - The company is pursuing a growth strategy as a marketing experience (MX) company, emphasizing integrated service excellence and evolving its culture [6][7] - The company aims to capitalize on its unique maker culture to attract top talent in the marketing industry [9] - The company is committed to reducing complexities for clients by providing integrated marketing solutions across all media channels [33] Management's Comments on Operating Environment and Future Outlook - Management noted that economic uncertainty has led clients to adopt a more conservative approach to marketing investments [5] - The company expects lower print volumes for the remainder of the year due to ongoing macroeconomic concerns, despite positive first-quarter growth [28] - Management reaffirmed the 2023 guidance and expressed confidence in achieving the low end of the targeted debt leverage range by year-end [27][43] Other Important Information - Free cash flow was negative $79 million in Q1 2023, primarily due to working capital timing and capital expenditures [40] - The company maintains strong liquidity with $321 million available under its revolving credit agreement and $9 million in cash [41] Q&A Session Summary - No specific questions or answers were documented in the provided content, indicating a smooth conference call with no significant inquiries from participants [31][32]