ACCO Brands Management Discusses Q4 2011 Results - Earnings Call Transcript
During the call, we may make forward-looking statements, and based on certain risk factors, our actual results could differ materially. Please refer to our press release and SEC filings for an explanation of those factors.
Following our prepared remarks, we will hold a Q&A session. Now it is my pleasure to turn the call over to Mr. Keller.
Neal V. Fenwick
Thank you, Bob. Our fourth quarter performance is recapped on Slide 4. Reported sales decreased 2%, and volume decreased 4%. We expanded our gross profit margin 50 basis points to 32.2%. The improvement came from freight distribution and other process efficiencies, particularly in Europe. SG&A expenses are down in the quarter, 130 points excluding $4.1 million of costs related to the pending acquisition due to reduced expenses in both Europe and Computer Products.In all, fourth quarter operating income increased 17%, also excluding the Mead transaction cost. And operating margin increased 11.4%, an improvement of 190 basis points. EBITDA increased 8% to $52 million, and EPS from continuing operations increased 26% to $0.29 versus a comparable $0.23 in the prior-year quarter. For the full year, sales increased 3% driven by currency and pricing. Volume was down 2% due to declines in U.S. and Europe, largely due to inventory reductions by certain customers and lower demand in Europe. As shown on Slide 5, for the full year, gross margin increased 60 basis points to 31.5%. Operational improvements, particularly in Europe, were the largest driver of the increase. SG&A was up 2.5% for the year excluding $5.6 million of costs related to the pending acquisition. The increase in SG&A dollars was due largely to the impact from foreign exchange, which was $7 million. As a percentage of sales, SG&A was even with the prior year at 21.9%. Investments made in the first half of the year to improve our operations in Europe were offset by savings in the second half of the year. Operating income increased 10% for the year excluding transaction-related costs, and margin expanded 70 basis points to 9.2%. EBITDA increased 6% to $168 million and to 12.8% of sales.
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