Cenveo Announces 4Q, Full Year Results

Cenveo, Inc. announced results for the three and 12 months ended Jan. 2, 2016. The reported results exclude the operating results of the Packaging operating segment as well as the one top-sheet lithographic print operation, collectively referred to as the Packaging Business, as it has been classified in the consolidated financial statements as discontinued operations. During the first quarter of 2016, Cenveo completed the sale of its Packaging Business.
 
The company generated net sales of $479.0 million for the three months ended Jan. 2, 2016, compared with $453.5 million for the same period last year, an increase of 5.6%. The fourth quarter of 2015 included an extra week versus the fourth quarter of 2014. Cenveo experienced strong sales performance in all three of our operating segments during the fourth quarter, particularly in its print business, driven by new account wins.
 
The company generated net sales of $1.74 billion for the year ended Jan. 2, 2016, compared with $1.76 billion for the prior year, a decline of 1.1%. The decline in net sales for the year is primarily attributable to decreased capacity in the envelope business due to the closure and consolidation related to the National Envelope integration during 2014, partially offset by one extra week in the full year 2015 versus the full year 2014, price increases and product mix changes with certain envelope customers.
 
“We are very pleased with our fourth quarter operating results, in which we experienced solid revenue performance, increased our operating income and improved Adjusted EBITDA as expected,” said Robert G. Burton Sr., chairman and CEO. “We also completed one of our strategic alternatives with the sale of our Packaging Business, which officially closed in January. Our envelope business continued to deliver margin expansion driven by strong direct mail volumes and the benefits of the cost actions that we completed in 2014. This performance allowed the Company to deliver Adjusted EBITDA growth of over 32% for the fourth quarter compared with the same period in 2014.”
 
Operating income was $24.8 million for the three months ended Jan. 2, 2016, compared to operating income of $11.2 million for the same period last year, an improvement of 121.0%. Operating income was $83.8 million for the year ended Jan. 2, 2016, compared to operating income of $42.8 million for the prior year, an improvement of 95.9%. Operating income in 2014 was impacted by expenses associated with the closure and consolidation of several envelope facilities related to the integration of the National Envelope assets, which along with the price increases realized from certain customers, primarily resulted in significant operating
 
For the three months ended Jan. 2, 2016, the company had a loss from continuing operations of $4.4 million, or $0.06 per diluted share, compared to a loss of $23.4 million, or $0.34 per diluted share, for the same period last year. For the year ended January 2, 2016, the company had a loss from continuing operations of $19.5 million, or $0.29 per diluted share, compared to a loss of $95.1 million, or $1.42 per diluted share, for the prior year.
 
Adjusted EBITDA was $44.1 million and $33.3 million for the three months ended Jan. 2, 2016 and Dec. 27, 2014, respectively, an improvement of 32.5%. For the year ended Jan. 2, 2016, Adjusted EBITDA was $158.0 million, compared to $139.4 million for the prior year, an improvement of 13.3%. The increase is primarily attributable to the improvement of envelope operations subsequent to the prior year consolidation efforts and continued operating improvements in the label product lines, partially offset by a decline in print operations due to product mix and continued price pressure.
 
Cash flow provided by operating activities for the year ended January 2, 2016 was $32.2 million, compared to $23.9 million for the prior year.