ACCO(ACCO) - 2025 Q1 - Quarterly Report

Financial Performance - Net sales for Q1 2025 were $317.4 million, a decrease of 11.5$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]