R.R. Donnelley & Sons Co.’s second-quarter profit more than tripled, beating expectations, following prior-year charges as revenue increased more than expected.
The largest commercial printer by market value in the U.S. suffered from falling prices and slumping demand for several years as many publishers cut back on print to control cost or move businesses online. R.R. Donnelley posted declining earnings consistently as the sector is challenged by overcapacity that has kept prices low and margins pressured.
R.R. Donnelley has been focusing on expanding its offerings to diversify, hoping to drive revenue growth. President and Chief Executive Thomas J. Quinlan III said Wednesday the company second-half performance will be supported by “many long-term customer contracts we have been awarded already this year.”
It reported a profit of $88.8 million, or 42 cents a share, up from $25.2 million, or 12 cents a share, a year earlier. Excluding restructuring charges and write-downs, earnings rose to 47 cents from 37 cents as revenue increased 2.2 percent to $2.41 billion.
Analysts polled by Thomson Reuters most recently estimated earnings of 36 cents and $2.37 billion in revenue.
Operating margin widened to 7.1 percent from 5.7 percent as costs rose just 0.6 percent.
U.S. revenue, the company’s primary focus, rose 1.6 percent as earnings increased 11 percent on higher margins. International revenue grew 4.3 percent as strong volumes were mainly offset by prices declines. Profit increased 12 percent.
Shares closed at $17.11 Tuesday and were inactive premarket. The stock has fallen 23 percent this year.
-By Jodi Xu, Dow Jones Newswires
