As it heads toward its acquisition by Quad/Graphics, Worldcolor reported a smaller operating loss in the quarter ended March 31 and a decline in revenues. Total sales fell 8.6% to $692 million, while the operating loss was cut to $11 million from $30 million; adjusted EBITDA increased to $79 million from $36 million in the first quarter of 2009. Among its operating segments, sales in the publishing services group, which includes book, directory and magazine printing, fell 10%, to $316 million.
Volume declines and some pricing pressure led to the drop in revenue, while cost cutting and plant closures helped to improve the bottomline as Worldcolor streamlines its operations. Plant and corporate staff levels were reduced by 7% in the first quarter with 401 positions eliminated and another 1,299 jobs are set to be cut later this year when previously announced plant closings are implemented.
Worldcolor’s acquisition by Quad/Graphics, announced earlier this year, has been cleared by regulatory authorities in the U.S. and Canada and is expected to be completed this summer. When the deal is done, the privately-held Quad/Graphics will become a publicly-traded company
