United States: The development of the printing industry is improving

In early August, four large print companies in North America released their second quarter 2010 financial reports on their official websites. Taking a comprehensive look at the operations of the Donnelley, Cote-Tourbon, Savio Europe, and Uniprints in the second quarter, their businesses at different levels have encouraged the industry. At the same time, their financial results also confirm that the American Association of Printing Leaders (NAPL) judged at the beginning of this year that the situation in the US printing industry is improving and the economic foundation for the rebound has been laid.

Donnelly

〇 Print and related business unit net sales of 1.8 billion US dollars, an increase of 1.6%

〇 Increased sales of logistics services, textbooks, direct mail, and commercial printing

〇 Price pressure, bonus payouts and other factors partially offset the gains from increased print sales

RR Donnelley & Sons Company announced its second quarter earnings on its official website on August 4th. The financial report shows that in the second quarter of this year, the company’s shareholders’ income was US$88.8 million, or 42 cents per share, and net sales were US$2.4 billion. The shareholder’s income in the same period of 2009 was US$25.2 million, or 12 cents per share. Compared with net sales of $2.4 billion, earnings have increased significantly, and in particular, earnings per share have increased by nearly 3 times. However, the company's gross profit margin in the second quarter was 24.5%, which was a slight decrease from 25.4% in the same period of last year. The company stressed that continued price pressures, reduced paper sales, and high bonus payments partially offset the gains from increased print sales.

According to statistics, in the quarter, net sales of the printing and related business unit of Donnelley in the United States was 1.8 billion U.S. dollars, an increase of 1.6% over the same period of last year. Excluding the restructuring and impairment charges, the domestic sales operating margin increased to 10.1%, compared to 9.2% in the same period of last year. The company stated that although the sales volume of logistics services, teaching materials, direct mail, and commercial printing has increased, the prices of products in almost all areas have been reduced, which has affected the realization of sales revenue increase.

The international sales division’s net sales were US$ 599.3 million, an increase of 4.3% over the same period in 2009. Donnelly said that sales in Asia, Europe and other regions have increased a lot, but they are also facing low prices. Excluding restructuring and impairment expenses, the operating margin for this segment was 8.2%, which is also an increase compared to the operating margin of 7.6% last year.

Cod-Tuwen Corporation

Profit increased by approximately 27% year-on-year

Net sales of 1.08 billion U.S. dollars, basically the same as last year

〇 Acquisitions increase operating income

The United States’ largest commercial printing company, Quad/Graphics, has already completed the acquisition of World Color Press Inc., and on August 10, the company announced on its website that the combined company is Estimated operating income for the second quarter and first half of this year. The data shows that the merger of the two large companies shows a strong scale effect.

According to statistics, in the second quarter, the company’s estimated EBITDA was US$148.3 million, which was approximately 27% higher than 2009’s US$116.6 million; estimated profit margin was 10.6% from the same period in 2009. Increased to 13.8%; estimated net sales of 1.08 billion US dollars, compared with 1.1 billion US dollars the same period last year.

As of June 30, 2010, the company’s estimated net sales for the first half of the year were US$2.17 billion, a decrease of US$100 million year-on-year, but EBITDA and profit margin were estimated at US$288.5 million and 13.3 respectively. %, compared with $220.3 million and 9.7% in the same period of last year, has improved significantly.

The company's executive vice president and chief financial officer said that these figures are in line with their expectations. Although the company still has higher costs, the combined company still increases its EBITDA by 27%.

Sen Weiou printing company

Net sales revenue was US$445.3 million, an increase of 12% year-on-year

〇Envelopes and commercial printing business have greatly improved

〇 Acquisitions show effectiveness in the second quarter

On August 11th, Cenveo, Inc., a major printing company in the United States, published its financial reports for the second quarter and the first half of the year on its official website.

For the second quarter of the fiscal year ended July 3, 2010, the net sales revenue of the Printemps Printing Company was $445.3 million, an increase of 12% from $397.6 million in the same period of the previous fiscal year. At the same time, net sales for the first half of the year amounted to US$ 899.2 million, an increase of approximately 11% year-on-year. According to the analysis, the increase in revenue during this period was mainly due to the purchase of Nashua Printing Co. last year and sales data for the first half of this year which is one week more than last year.

In the second quarter, the sales income of the printing company of Senwei Europe was 19.4 million US dollars, while in the same period last year the company also lost 5.5 million US dollars. The total operating income for the first half of the year was 31.6 million US dollars. Compared with the loss of 5.3 million US dollars in the same period of last year, it also achieved a turnaround. In addition, during the quarter, the company still had a net loss of 8.3 million U.S. dollars. Compared with the loss of 18.3 million U.S. dollars in the same period of last year, the loss was significantly reduced, and the amount of losses in the first half of the year was also reduced by 3.2 million U.S. dollars. The company said that restructuring and impairment expenses have been reduced, but the lower income tax refundable income has, to some extent, reduced the benefits of this part of the cost reduction.

Robert Burton, the company's president and chief executive officer, said that the company achieved a very good performance in the second quarter, the company's envelope and commercial printing business has greatly improved, the company's cash flow in the first half increased by 34 %. At the same time, the company’s acquisition of a content solution provider also showed an effect in the second quarter, which not only enhanced the company’s market share, but also increased its terminal service capabilities in the fields of journals and book publishing.

Uniform Printing Company

〇 Operating income was US$236.7 million, a year-on-year increase of 4.8%

〇 same store sales growth of 2.3% year-on-year

〇 M & A income is also more impressive

Consolidated Graphics, Inc., one of the major commercial printing service providers in North America, announced its second quarter financial results on its official website on August 4. According to the data, as of June 30, 2010, the company’s operating income was US$236.7 million, a year-on-year increase of 4.8%. According to the analysis, its revenue growth was mainly due to a large number of election-related sales operations, which resulted in an increase of 2.3% in same-store sales revenue. In addition, mergers and acquisitions initiatives also increased the earnings for the quarter.

In the context of the increase in sales and cost reduction in the previous year, the company's adjusted operating income increased by US$ 9.7 million over the same period last year. The adjusted net income was US$ 4.9 million, compared to net income of US$ 0.6 million in the same period last year. This year has greatly improved. The adjusted profit before tax, depreciation, amortization and amortization was US$27.1 million, an increase of 35% year-on-year.

The company’s president and chief executive, Joe Davis, said that after 12 consecutive quarters of declining revenue, same-store sales have finally grown during the quarter. Although the economic situation has improved to a certain extent, we have found that the demand for many customers is still uncertain and the demands put forward are also more demanding.

Reporter Comments

Looking at the second quarter report of four major print companies in North America, it can be seen that the diversion of the North American printing industry continues. The commercial printing industry is currently in a period of rapid integration and change. Several major companies have already merged, and many large and small companies have also consolidated. The company will also be phased out or reorganized. In the second quarter financial reports of the four large printing companies, three companies mentioned the positive effects of the acquisition and brought them positive effects. It can be seen that the ongoing industry consolidation has achieved initial results. It is unavoidable that the negative effects brought about by the continuous price pressure problem have become more obvious. For example, in his earnings report, Fernando repeatedly emphasized the impact of price pressure on his business.