RR Donnelley Q2 profits up despite slowdown in print sales
By David Ward, San Diego Thursday, 02 August 2012
Chicago-based R.R. Donnelley & Sons posted a second quarter profit of $88.8m, up from $12.2m for the same period in 2011, despite a 3.6% decline in revenues to $2.5bn.
The company noted sales in its U.S. print and related services segment, which happens to be its largest, fell by 3.9% to $1.8bn, with net sales down 4.5% as continued price pressure and volume declines offset a rise in its office products, premedia and logistics businesses. International sales were off 2.8% to $682.6m.
During a conference call with analysts to discuss the results, RRD president and CEO Thomas Quinlan highlighted the company's moves beyond traditional print. "During the second quarter, our services revenues grew 27.2% as compared with the same period a year ago," he said, adding that for the three-month period services represented 13.4% of total revenues.
"We have a broad services portfolio. For example, we have more than 10m of our customers' pictures, logos and other elements in our proprietary digital asset management system. We believe that we are one of the top 20 providers of translation services in the world, with an offering whose revenues are approximately 360% larger than they were in 2009."
Quinlan spoke briefly of the company’s acquisition of Edgar Online earlier this year and also touted the early results of the company’s internally developed ProteusJet presses, citing, as an example, one customer that had been using two-color statements that were accompanied in the envelope by preprinted inserts.
By leveraging ProteusJet to switch to a four-color statement that uses printserts, which are marketing messages embedded in the billing documents themselves, the customer saw a 25-fold increase in response rates compared to the inserts they had been using.
"We believe that when you deliver an innovative solution that yields a 2,500% increase in response rates for printed pieces, it helps to change the underlying economics of traditional statement delivery to implement on-demand book production strategies and to take advantage of TransPromo opportunities," Quinlan said.Tweet
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