R.R. Donnelley & Sons Company

remarks from company representatives, we will conduct a question and answer session by phone. To ask a question, you must be connected by phone as the webcast is a listen-only platform. Please press star 1 on your touchstone telephone. Please note that this call is being recorded. I will now turn the call over to Johan Nyset, RRD's Senior Vice President of Finance.

Thank you, Ashley, and thank you everyone for joining RRD's first quarter 2021 results conference call. Joining me on today's call are Dan Notz, RRD's president and chief executive officer, and Terry Peterson, our chief financial officer. At the conclusion of today's prepared remarks, Dan, Terry, and I will take questions. As a reminder, we have prepared supplemental slides for today's call, which can be found on the investor section of our website at rrd.com. As we review our results on today's call, I will be advancing the slides if you are connected by webcast. Alternatively, we will periodically reference page numbers from the supplemental slides for those participants who wish to follow along by advancing the slides themselves. The information reviewed during this call is addressed in more detail in our first quarter press release, a copy of which is posted on the investor section of our website at RID.com. This information was also furnished to the SEC in the Form 8K we filed yesterday. In addition, we will also refer to forward-looking statements, including comments on our financial outlook and strategy, all of which... Therefore, our actual results could differ materially from our current expectations. For a complete discussion of the factors that could cause our actual results to differ materially, please refer to the cautionary statement, including in our earnings release, and the risk factors included in our annual report on Form 10-K, our quarterly reports on Form 10-Q, and other filings with the SEC. Further, we will discuss non-GAAP financial information. We believe the presentation of non-GAAP results provide investors with useful supplementary information concerning the campus ongoing operations, and it's an appropriate way to evaluate the campus performance. These non-GAAP results are provided for informational purposes only. Any references to non-GAAP financial measures are reconciled to the comparable GAAP financial measures in the investor section of our website as part of our press release. I will now turn the call over to Dan.

Thanks, Johan. Good morning, everyone. It's great to be with you, and thank you for joining our call today. On behalf of all of us at ORD, I hope that you and your families continue to stay healthy and safe. On today's call, I'm going to recap our first quarter results and provide an overview of how we are deploying our extensive capabilities to win new opportunities in what remains a dynamic market. And then before turning the call over to Terry, I will share a couple of recent awards that reinforce the strength of our brand and the high-level performance we are delivering for our clients. Our first quarter results represented a strong start to the new year, reflecting the scale and breadth of our business model, very solid operating performance, and our unwavering commitment to successfully navigate through this challenging pandemic environment. I'm especially proud of the RD team for continuing to perform at a high level for our clients while protecting the health and safety of our global colleagues. When the COVID-19 crisis emerged a little more than a year ago, we developed an aggressive game plan to strengthen our businesses amidst a rapidly changing economic environment and very uncertain outlook. Guided by our strategic priorities to strengthen our core, drive revenue performance, and improve financial flexibility, over the last 12 months, the RRD team has been relentlessly executing our game plan, and our results for the last three quarters reflect the positive impact of those actions. Highlighted by continued improvement in our organic sales decline trend, solid adjusted IPO performance against 2020 strong results, and a significant improvement in our operating cash flow versus the prior year, I am pleased with our Q1 operating and financial performance. As aligned with our strategic priority to improve our balance sheet flexibility, we recently announced the extension of the maturity date for our ABO credit facility and the refinancing of a significant portion of our 2024 term loans with new senior secured notes. Let me provide a little bit more color on our financials for the quarter. Despite the ongoing impact of the pandemic, our first quarter sales exceeded our expectations. Back in February, we said that we expected net sales in the first quarter to be between $1.09 billion and $1.15 billion, reflecting lower pandemic-driven client demand, the conclusion of the census project in 2020, and an exceptionally strong pre-pandemic first quarter of last year. Our net sales in the first quarter were $1.17 billion, which surpassed the high end of our guidance. Organic sales declined 4.3%, further building on the sequential improvement we reported in the third and fourth quarters of last year and represented our lowest year-over-year decline since the global pandemic emerged. Our improving organic sales trend reflects both strengthening client demand and our commercial team's success in leveraging our industry-leading portfolio of marketing and business communications capabilities to win new clients and expand existing client relationships. Turning to the segments, I'm encouraged by the performance of business services, which delivered overall organic sales growth of 2.4%. Importantly, we are capitalizing on emerging client opportunities and strengthening end markets to achieve organic increases in packaging, labels, and supply chain services, three of our strategic growth product categories. Marketing solutions reported a 22.5% organic sales decline, largely related to clients deferring marketing spend amidst an uncertain business environment, as well as last year's census project, which wrapped up mid-2020. We do expect to see clients increase their marketing spend as economic conditions continue to improve. We delivered $37.4 million in adjusted income from operations, $13 million lower than a year ago, largely due to $11 million of unfavorable foreign exchange primarily associated with our China operations. The benefit of our ongoing action is to reduce our cost structure, nearly offset the full impact from lower sales, including the census not repeating, and higher incentive compensation reported in the quarter. Through working capital improvements, we reduced the cash used in operating activities by $61 million, and as you've seen with our recent announcements, we continue to rework our debt to give us the flexibility needed to further expand our capabilities across our print and digital channels. I'm also encouraged by how our sales teams are winning new opportunities emerging from the pandemic, as well as those being created as a result of our clients' digital transformation initiatives. As organizations rethink their approach to their marketing and business communication strategies, we are deploying the full scale and breadth of our digital and print capabilities to support their evolving communication requirements. For example... We have a robust pipeline of opportunities across health care providers, health insurance companies, and life science organizations that's being driven by the scale and breadth of our regulated supply chain, kitting, and fulfillment services capabilities. Recently, the state health department looked to R&D to rapidly create and distribute personal protective equipment kits to home health care workers. We sourced all the materials, including masks, face shields, gloves, protective gowns, and safety goggles, through our expansive vendor and partner network. We also handled the packaging, print materials, kitting, fulfillment, reporting, and delivery of these time-sensitive PPE kits in just four weeks. Building on our supply chain packaging and kitting capabilities, we've rolled out a branded solution for health and wellness kits called Care Kits by R&D. Our end-to-end solution encompasses kit ideation, design, item procurement, packaging, fulfillment, and communications both inside and outside the box. Additionally, as direct-to-consumer sales channels continues to grow in the retail world, we are working with a number of online retailers who are marketing directly to consumers with subscription services that send boxes Subscription boxes and meal kits took off during the pandemic as consumers in lockdown had more time to cook and try new hobbies. Now, brick-and-mortar retailers, restaurants, and consumer packaged goods companies are investing in home subscription services to support and sustain the growing direct-to-consumer trend, and R&D is well-positioned to support our clients' needs in this area. Rick has also brought about a number of changes in consumer behaviors, with one of the most significant being a shift to e-commerce. As product sales shift online, we are innovating to further expand our creative and technical capabilities to help brands and retailers create rich user experiences and accelerate their go-to-market speed. Last month, we announced a suite of 3D solutions that features modeling, animation, rendering, and interactive experiences to enable simulations and digital prototyping. One use case that's gaining traction is simulating the in-store shopping experience to create highly engaging and immersive experiences for online shoppers. As the spatial web evolves, we are positioning R&D to support our clients in this emerging area through our suite of 3D solutions. Earning the right to grow with our existing clients through service quality and operational excellence is paramount to driving our revenue performance. Our being expert in filtration highlights our powerful packaging solutions, service, and operational performance. R&D manufactures folding cartons for May & Hummel and is one of their highest rating folding carton vendors in their supply chain. Based on our performance in geographic reach, May & Hummel has selected R&D to be their folding carton supplier for their Mexico operations that we will support through our facility in Reynosa, Mexico. A large nonprofit organization also recently awarded the three-year contract for acquisition campaign services, including print management, direct mail, creative design, campaign production, and fulfillment. As part of this contract, R&D maintains an on-site presence to enable better collaboration with key stakeholders and ensure smooth coordination and execution. For each campaign, we manage hundreds of orders that require the proper production and assembly of multiple components to meet their mailing requirements. Over this long-standing relationship, we are delivering cost-effective solutions while providing this client with maximum marketing flexibility. Before I turn the call over to Terry, I'd like to highlight some recent notable recognition that reaffirms the strength of our marketing capabilities and operational performance. At the beginning of the year, Forrester Research, a leading independent research firm, ranked R&D as a strong performer among the top customer database and engagement agencies. Data management and analytics are critical for customer experience marketers, and Forrester found that advanced analytics and reporting are where RRD shines. We also received higher marks for collaboration than any agency in the study. The recognition in the Forrester Wave Q1 2021 report is another feather in the cap of our marketing solutions team, reflecting our best-in-class approach to data, creative services, and marketing technology. We're also excited to announce that our exceptional packaging work with the Pokemon trading card games Zation and Zamazenabox has garnered some important industry recognition. Our packaging solutions team won three Best of Category awards, including the Sun Chemical Best Packaging Award from the Printing Industries of the Carolinas. The PICA Awards competition is one of the largest printing contests in the nation, and the Pokemon TCG Premium Collector's Box includes special gold versions of the two characters, as well as dice, metal coins, and booster packs. Finally, our global outsourcing and creative team was recently recognized by the Business Continuity Institute, a global organization of business recovery experts. Awards in India and South Asia for the most effective recovery and continuity and resilience team. Looking ahead, we're seeing solid progress in vaccination rates, consumer competence, and economic conditions, but we also know that challenges remain on the path to a full economic recovery. As such, the RRD team continues to be intensely focused on executing our strategic priorities, and we remain confident that we are building a stronger RRD for the future. With that, I'll turn the call over to Terri.

Thank you, Dan. Our start to 2021 was strong across the board, despite a second consecutive quarter of significant foreign exchange headwinds. Our sales and adjusted income from operations came in at the top end of our earlier estimates, with the organic sales decline rate improving sequentially for the third consecutive quarter. Adjusted income from operations was solid despite unfavorable foreign exchange, which provided an $11 million headwind. As a reminder, the first quarter of 2020 comparison was the strongest first quarter adjusted IFO we have ever delivered since the 2016 spin, as most of our global operations had not yet been impacted by the pandemic. Recent actions to reduce our cost structure continue to mostly offset the impact of the pandemic and last year's census. We also reported a $61 million improvement in operating cash flow versus the first quarter of 2020, due primarily to working capital improvements. In addition, total debt remained unchanged from year end 2020. This is the first time since our 2016 spin where we have avoided additional borrowings at the end of first quarter as compared to the previous year end. Lastly, we made significant progress to further improve our balance sheet flexibility earlier this month when we completed an amendment to our ABL credit facility, which extended the maturity date to 2026. We also priced $400 million of new 6.125% senior secured notes, which we closed as planned earlier this morning. Most of those proceeds were used to repay a portion of our outstanding term loans, which effectively extends their maturity date to late 2026. I'll talk more about these transactions later in my prepared remarks, but first let me get started with the review of our first quarter performance. Turning to slide eight, net sales were down 3.6% in the first quarter, which includes an increase of 14.5 million due to foreign exchange and a decrease of 6.5 million from the previous closure of our operations in Chile. On an organic basis, we reported a decline in net sales of 4.3%, primarily related to the impact of the ongoing pandemic and last year's census project, which wrapped up mid-2020. Our organic sales decline represented our lowest year-over-year decline rate since the pandemic affected our global operations. For the segments, business services reported another strong quarter with organic growth of 2.4%. We delivered organic growth in several of our strategic product categories, including packaging, labels, and supply chain management. While many of our global operations continue to be NIMIC, our net sales increase in China more than offset these declines since the operations in China were closed for approximately one month in 2020 due to the pandemic. The recovery from last year's closure primarily benefited our packaging and commercial print product categories in their year-over-year comparison. Marketing Solutions reported an organic decline of 22.5% as a result of the pandemic's ongoing impact on our clients' marketing-related spend and the completion of the census project in mid-2020. On slide 9, adjusted income from operations of $37.4 million was $13 million lower versus the first quarter of 2020, and the corresponding operating margin decreased from 4.1% in 2020 to 3.2% this quarter. Results for the 2021 quarter were negatively impacted by approximately $11 million due to foreign exchange, which is mostly associated with our operations in China. Proactive actions to reduce the company's cost structure nearly offset the impact of lower sales and higher variable incentive compensation expense. Adjusted SG&A expense of $152.9 million in the first quarter is down $5.7 million or 3.6% from the prior year, reflecting our ongoing efforts to lower our cost to serve. Adjusted earnings per share from continuing operations was $0.08 in the first quarter as compared to $0.27 reported in the prior year quarter. The reduction was attributable to lower adjusted income from operations and unfavorable income taxes. Our adjusted effective tax rate was 47% in the quarter versus 3.9% in the prior year quarter, which included benefit from the CARES Act. Our gap results for the quarter included pre-tax restructuring, impairment, and other charges of $5.8 million, which were $5.4 million lower than last year, just associated with our 2020 closure of the operations in Chile. Turning now to the balance sheet and cash flow on slide 10, As of March 31, 2021, we had total cash on hand of $262 million and total debt outstanding of $1.5 billion, which remained unchanged from the prior year end. Availability on the credit facility was $512 million at the end of the quarter and total available liquidity, including cash on hand, was $774 million, which was up $644 million at March 31, 2020. The gross leverage ratio of 3.9 times at March 31, 2021 improved from 4.8 times at March 31, 2020, while the net leverage ratio of 3.2 times improved from 3.8 times a year ago. First quarter's net cash used by operating activities was $18.9 million, which was an improvement of $60.7 million as compared to the 2020 quarter. The significant year-over-year improvement was primarily driven by favorable working capital, partially offset by lower earnings and LLC bankruptcy-related payments. Capital expenditures of $13 million were $4.7 million lower compared to the 2020 quarter. Slide 11 summarizes several key actions we have taken to improve our balance sheet during the year. Collectively, our efforts have yielded a reduction in total debt outstanding of nearly $900 million since 2016, while significantly improving both our gross and net leverage. In regards to the pending sale of our printing facility in Shenzhen, China, we continue to wait for the required government approvals so we can complete this sale. Once the transaction closes, we expect to record a significant gain on the sale. To date, we have collected $123.3 million in deposits, and we are scheduled to collect one additional deposit of the 21. Our contract with the buyer requires them to pay the final installment in 2022, even if the government's final approval is delayed. If the buyer fails to comply with terms of the agreement or terminates for any reason, RRD is entitled to retain 30% of the purchase price in liquidated damages. Slide 12 shows the variances. Great maturities of our outstanding debt as of December 31st, 2020 and at March 31st, in addition to the pro forma maturities at March after giving effect to the April ABL credit facility amendment and the closing of our new senior secured notes and the use of those proceeds. Completing these two transactions represents another significant step forward in our plan to improve our balance sheet flexibility to better support our strategic initiatives. Our expectations for full year and second quarter of 2021 are reflected on slide 13. As the COVID-19 infection rates remain elevated in many parts of the world, we expect the path forward to remain uncertain and volatile. As such, we are unable to furnish our typical guidance for 2021. However, I do have the following observations and guidance for 2021. Net sales for the year are expected to be flat to up below single digits, taking into consideration reductions from the census project and one-time pandemic-related projects in the last half of 2020, offset by a modest economic recovery as the year progresses. Net sales in the second quarter are expected to be between $1.1 and $1.15 billion. up 8% to 13% organically, reflecting improvement from the pandemic, partially offset by last year's census project. Excluding the unpredictable impact from changes in foreign exchange rates and the possible impact from future inflation and labor availability, non-GAAP adjusted income from operations and the resulting operating margin are expected to be flat to up slightly from the prior year as the company continues to benefit from aggressive cost reduction actions. Non-GAAP adjusted income from operations for the second quarter is expected to be up from the prior year, reflecting an increase in volume and continued cost reduction efforts, partially offset by unfavorable foreign exchange of approximately $10 million, assuming the exchange rates do not change from the current rates. Depreciation expense is expected to be approximately $135 million for the year. Interest expense is expected to range from $120 to $125 million, excluding gap-only charges of approximately $9 to $10 million associated with terminating certain interest rate swap agreements in connection with the April 2021 Senior Secured Note issuance and term loan prepayment. Interest expense is expected to reflect benefits from lower average borrowings and a lower average interest rate in 2021 as compared to 2020. The full-year non-GAAP effective tax rate is expected to be approximately 35%, which is higher than reported in 2020 as non-recurring benefits were reflected in 2020 and the benefit from the CARES Act has expired. Operating cash flow is expected to be slightly lower than the prior year, reflecting a reduction due to the repayment of half of the employer portion of payroll taxes deferred in 2020 and payments to settle LSE bankruptcy-related obligations. Capital expenditures are expected to be approximately $80 million for the year. And now, operator, let's open up the line for questions.

Thank you. We will now begin the question and answer session. If you have a question, please press star, then 1 under Touchstone Phone. If you wish to be removed from the queue, please press the pound sign or hash key. If you are using a speakerphone, you may need to pick the numbers. Once again, if you have a question, please press star, then 1 under Touchstone Phone. Andrew, our first question comes from Charles Strausser with CJS Securities.

Hi, good morning. Hi, Charlie. Just to start off with the guidance, and Terry, maybe this is for you, but talking about the Q2 adjusted IFO, any additional color there as to how much of an increase you see year over year there?

Yeah, I mean, it's, you know, again, there's just some uncertainty with how the quarter will perform on an IFO basis. And let's say that, you know, if the increase was $10 million or less, that's probably, you know, reasonably conservative. And if it's over $10 million, that's probably in the category of achievable, but I'm more on the aggressive side. So that's probably the best color that I can provide on how we see IFO for next quarter.

Great. That's helpful. Thank you. And then just talking about the China facility that's still pending sale, any thoughts there as to giving any trepidation that that won't close or is that still proceeding as you kind of expected it to?

No, that still continues. There's no change in kind of our viewpoint on that going through or not. So we still feel very optimistic that that will close. All the work with the Chinese government, though, that is in the hands of the developer that is buying the property from us. Those communications and all of that work is being done by them. But we do get regular updates from them. They've continued to make all their deposits on time with us, and we have no reason to believe that the upcoming deposit for about $50 million later this year, we have no reason to believe that that won't come in on time.

Great. Great. And then lastly, on what's remaining payment-wise there, if you can kind of give us a sense of that.

So in first quarter, we had roughly a little over $9 million of bankruptcy payments there. That was largely to settle the SERP liability for them as part of the bankruptcy being accepted by the courts. We also had a payment as a result of that settlement of about $2.5 million, again, included in the nine, but that was for the MEP plan participants. And then separately, we have negotiated settlements with one of the three MET plans, and we negotiated a discounted settlement for that. So that will result in a payment of just a little over $9 million in again in the second quarter so that is a discounted settlement as an attractive offer and we decided to uh to fund that in order to uh to alleviate that liability uh we did take a uh there's a a 1.7 million dollar gain that's reflected in the non-gap results uh this quarter for that but the funding of that will happen in uh in uh april or second quarter here Besides that, we have with LSC, and we'll have some level of funding for that. It's a few million dollars a year for those, assuming that we don't execute any more settlements for those remaining two plans. We have a small amount of funding related to one lease that we had to take over as part of the guarantees that we had from the spend time, but it was a lease that was rejected as part of the bankruptcy process. So one lease there that will have a little bit of funding just to terminate that. That's just a matter of returning the facility to its previous use.

Great. Thank you for that. Dan, maybe this is one for you. On the marketing solution side, obviously that's been the laggard given the pandemic, hitting that the hardest. What are you hearing from clients about a return to spending post-COVID? Are you expecting to see some of that ramp in the back half of the year, especially when you lapse the census work?

Yeah, Charlie, I think marketing solutions, unlike some of the areas we've talked about within business services, it continues to lag. The recovery is continuing to extend out. I think the good news on that in the meantime – We are, as I mentioned in my previous comments, that we are pursuing the areas that are recovering faster, that we're well positioned in leveraging and flexing our platform to be able to go do that in the interim period as the marketing solutions continues to recover. But I think two things are important there. And, yes, the census is obviously impacting the size of those numbers because we're not doing it this year versus the last year. But the first one is, as you look at consistency of economic recovery, and you look at marketers looking for return on their investment. So having a sustained, consistent, sustained economic recovery, we do believe, based on feedback from clients, that as that occurs and they get more comfortable with that relative to unemployment, consumer confidence, consumer spending, et cetera, which all are trending in the right direction, that They want to be back in the mail, and we do expect to see that marketing spend increase as the year unfolds, assuming that the economic recovery sustains in a consistent manner and we don't take steps backwards. So that recovery is lagging, I think, the economic recovery, but we do expect that to come forward. And I think the second part of that is dependent upon industry. So it's going to happen at a different pace depending upon recovery of the industry, right? So as we think of the hotels, very different than some of the retailers, strategies, et cetera, not-for-profits. So I think it's paramount. It's proven it works. They're in a quest for driving their revenue performance, top-line performance as well. And I think as the economy continues to recover, we will see a recovery. recovery and marketing solutions.

And then when you look at the other side of the business that, you know, especially the packaging has been very well, you know, are you seeing, you know, a pickup in, you know, kind of repeat business or recurring business that you could carry forward from, you know, some of the kind of one-time stuff that, you know, was related to COVID?

Yeah, on the supply chain side in particular, but the good news about that is it connects from supply chain to packaging and labels opportunities as well with a number of those clients. So the short answer to that, Charlie, is yes. We're having ongoing conversations and exploring additional and leveraging that platform and the capabilities of that platform and pursuing new opportunities. But we are having recurring conversations and do expect to see some degree of recurring revenue. As Terry talked about, we had a lot of one-time items that happened in a number of years. one-time large, very large projects that happened in the Q4-type timeframe of last year. But as we have conversations, the current conversations we are having are progressing, and it's talking about... Great.

Thank you very much for taking my questions.

Yeah, thanks, Charlotte.

Your next question comes from Bill Mastris with Baird.

Morning, Bill. Hi, Bill. Hello. How are you guys doing?

Well, thank you. You're welcome.

Okay, so the first question I have is for Terry. And with the placement of the 6-1-8s, is that going to be really the last of really your debt issuances until maybe we approach 2024? Are we done for a while?

You know, we certainly, you know, the need to do something else at this point is significantly down, obviously. with the recent transactions. I can never say never, you know, because in all honesty, I mean, the, you know, I probably was a year ahead of myself in terms of with this recent issuance, but it was really just driven by, you know, the market conditions that today it was, you know, just very, very, you know, placement for us. So I can never say never, but certainly the The need to do anything in advance of the late 2026 maturities, it's down pretty low right now. But again, I'll never say never.

No, completely understand. Actually, no debt maturities for the balance of this year. year and fairly light debt maturities for 2022 and 2023. Can we safely assume that this is going to be really handled with free cash flow or proceeds from asset sales or kind of as a last resort, maybe the ABL? Is that a safe assumption?

Yeah, that is. I mean, those are obviously very small maturities coming up. The April 2021 maturity is behind us now. So, yeah, I mean, we have really nothing until, you know, until the February of 22 is come due. And, again, each of these upcoming maturities, they're all kind of in the small enough category to just be dealt with with existing cash flow issues. um, proceeds from, you know, asset sales and then kind of the last choices, um, availability on the credit facility. So you've got that nailed.

And so if you do have access cash, um, will you opportunistically maybe go out into the marketplace and repurchase debt, maybe to kind of, if you will, further ease some of the later maturities?

You know, I wouldn't go past the 2024s because, you know, I still have, you know, stuff left on the term loans to take care of. But if I had, you know, more cash or extra cash, my first go-to would be to do a further prepayment on the term loans. Those are the next medium-sized maturity that's coming up here, and that's January 2024. So I would chip away at that. And I'm kind of assuming that I won't be able to get anything notable in the market at a reasonable price on the 23s or the 22s. There's just not a lot of liquidity with those. So, again, assuming that I can't get anything there at a price that I view as reasonable, you know, we would look to the term loans to prepay that, which does not require any additional cost for prepaying that at par.

Okay, great. Next question I have is for Dan, and that has to do with expanding digital services to capture a larger portion of your client's marketing spend. Are these digital services being expanded with your in-house capabilities, or are they being done in partnerships with outside third parties? How is that evolving?

Yeah, the answer to that, Bill, is both. We are continuing to expand our own in-house capabilities. We mentioned previously the innovation and new offerings that we're continuing to develop. It's in a very concentrated area, and I think what's important is about that to reinforce is that the digital, when we talk about the ability to expand digital as being complementary to print to capture the larger portion of marketing spend as being able to differentiate ourselves and having that combination of the digital and the physical to take on more of that print spend. But it's in a targeted area within the digital world because digital is obviously a very broad definition. But the second part of that is we are absolutely working with and continue to explore additional opportunities to work with Third parties, technology is changing very, very rapidly. Investments are flowing regularly on that as required as technology changes rapidly. So using partnerships to stay up with that a bit in those key areas that we think are relevant. and our digital capabilities to support our current print channel offering. So the short answer to that is it's a combination of both, internal investments, expansion, as well as third-party relationships.

Thank you very much. I appreciate the call.

Thanks, Bill.

Again, for any questions, please press star, then the number 1 on your telephone keypad. Again, that is star 1 for any questions. That concludes our question and answer session. I will now turn the call back over to Dan Knotts.

Great. Thank you. And thank you, everyone, for joining us on the call today. A summary of our key takeaways from the call can be found on slide 15 of the presentation. In closing, I'd like to say thank you around the world for your ongoing dedication to serving and supporting our clients in our company. I'm grateful for your focus, your energy, and your commitment as we continue to learn and evolve in today's challenging climate. Please know your efforts are greatly appreciated. Thank you, everyone, and have a great day.

Thank you to XS and all your replay of RRD's first quarter 2021 results. call can be found on the investors section of our website at rrd.com. Thank you for joining us and that concludes the RRD first quarter 2021 earnings call.

That concludes today's conference. Thank you for your participation. You may now disconnect.