Slowdown Hits Donnelley's Earnings
Chicago-based R.R. Donnelley said net income was $38.3 million compared with $56.3 million, and had earnings of 32 cents per diluted share, down from 46 cents per share from a year ago.
The company said it has suffered from significant volume decreases in commercial print operations that produce magazines, catalogs and advertising inserts. R.R. Donnelley said it has been combating the slowdown by adjusting capacity by consolidating plants, closing facilities, idling equipment and reducing the number of workers and hours worked.
The results exclude pretax restructuring and impairment charges of $52.3 million to cover costs associated with the closing of plants and offices in Des Moines, Iowa, and Old Saybrook, CT, as well as workforce reductions.
After charges, net income for the quarter was $6.1 million, or 5 cents per diluted share. Revenues for the quarter were $1.3 billion, down 7 percent from the year ago period.
The company said it will continue to invest in transforming its strategy, structure and culture to become an integrated communications provider. Along those lines the company has invested $300 million to upgrade its printing plants.
"We remain firmly committed to transforming this company, and we are making substantial progress," said William L. Davis, president/CEO. "This flexible and integrated network will give us the capabilities to stay ahead of our customers' changing communication needs."