The company’s net income from continuing operations in 2022 was $161.4m, while for Q4 it stood at at $130.9m, compared to a net loss from continuing operations of $9.8m reported in Q4 2021.
The US-headquartered multichannel marketing and business services group said the 2022 effective tax rate of 34% decreased from 162.4% in the prior year period primarily due to higher earnings relative to the non-deductible tax adjustments.
Total debt outstanding at the end of the quarter was $1.52bn, up $56.5m from the prior year end. It said pension and OPEB (other post-employment benefits) plans were overfunded by $22m as of 31 December 2022, which was below the $42.1m overfunded amount at 31 December 2021.
Cash used in operating activities during the twelve months ended 31 December 2022 was $16.9m compared to cash provided by operating activities of $92.1m in the prior year.
The increase in cash used is primarily driven by working capital investments due to increased volume, including initiatives to accumulate inventory to better ensure availability for clients, inflation and higher merger related payments, RRD said.
The company attributed the majority of its sales growth in 2022 to “higher client demand for many of the company’s products and services, and price increases to offset inflationary cost increases”.
“In particular, the company experienced strong growth in labels products. Organic net sales increased 2.8%, excluding a negative impact of $30m due to changes in foreign exchange rates.”
Operating income recorded in the fourth quarter of 2022 included a $134.2m gain recognised on the completion of the sale of a printing facility in Shenzhen, China, and transfer of the related land use rights.
The company said it expects to repatriate the cash from this sale to the US in 2023 and intends to use the proceeds to reduce debt.
Chatham Asset Management purchased RRD in early 2022. Its largest investor, Chatham bought out the rest of RRD’s shares, taking the company off the New York Stock Exchange.
Last week, meanwhile, RRD announced the sale of its Canadian operations to Data Communications Management (DCM), a document management and commercial print company based in Ontario.
Shares in RRD closed at $10.84 yesterday (1 March), flat on Tuesday’s price.
