The following is a summary of the ACCO Brands Corporation (ACCO) Q1 2024 Earnings Call Transcript:

Financial Performance:

• ACCO Brands reported Q1 2024 adjusted EPS of $0.03, in line with expectations, thanks to strategic pricing and diligent expense management.

• Gross margin rate expanded by 120 basis points in Q1 2024, largely due to effective cost control and lesser inventory than Q1 2023.

• They generated a healthy Q1 free cash flow of $26 million and reduced their leverage ratio to 3.5x from 4.3x.

• The company experienced an 11% sales decline in Q1 2024, with a planned exit of lower-margin businesses accounting for 2% and 3% related to decreased end-of-season sales in Brazil.

• 2024 full year is expected to see a reported sales decrease of 5% to 7% and a projected EPS range of $2 to $7.

Business Progress:

• Despite lower sales, positive trends are present in ACCO's technology accessories, with sales decline expected to moderate in the latter half of the year.

• To cope with changing work dynamics post-COVID, ACCO is actively sourcing innovative product solutions.

• 14% Q1 sales growth was seen in ACCO's brand PowerA, primarily due to increased wireless controller supply and international growth.

• ACCO Brands is carrying out restructuring efforts, such as optimizing management structures and supply chains, to increase long-term profitability, with a target of achieving at least $60 million in cost savings.

• They are investing in the development of innovative products, improving e-commerce operations, and capitalizing on growth opportunities.

• Despite a projected inconsistent 2024 sales, ACCO Brands is focusing on expanding internationally, developing catering solutions for remote work trends, and exploring market opportunities in wellness and ergonomics.

More details: ACCO Brands IR

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