R.R. Donnelley & Sons Company

Welcome to the RRD fourth quarter 2021 results conference call. My name is Emma and I will be your operator for today's call. At this time, all participants are in a listen only mode. Please note that this call is being recorded. I will now turn the call over to Johan Nysted, RRD's Senior Vice President of Finance.

Thank you, Emma, and thank you, everyone, for joining RRD's fourth quarter and full year 2021 results conference call. Joining me on today's call are Dan Notz, RRD's president and chief executive officer, and Terry Pearson, our chief financial officer. 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 fourth quarter press release, a copy of which is posted on the investor section of our website at rrd.com. This information was also furnished to the SEC in the form 8K we filed earlier this morning. In addition, we will also refer to forward-looking statements, all of which involve risks and uncertainties. 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 included 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 company's ongoing operations and is an appropriate way to evaluate the company's 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. Lastly, due to the pending merger transaction between RRD and an affiliate of Chatham Asset Management, we will not be conducting a Q&A session following our prepared remarks today. And with that, I'll turn the call over to Dan.

Great. Thanks, Johan. Good morning, good afternoon, and good evening, everyone. And thank you for joining us today. First and foremost, I'm pleased to share that we finished a very strong 2021 with fourth quarter results that exceeded our expectations. Before providing more color on our fourth quarter and full year performance, I want to first make a few comments regarding the merger agreement with Chatham Asset Management, a leading private investment firm. On December 14th, 2021, we announced a definitive merger agreement with Chatham Asset Management. Our board of directors unanimously approved the transaction following a thorough review of alternatives to maximize value for our stockholders. We believe that this proposed transaction represents the best path forward for our company and our stockholders. On February 23rd, five days from today, our stockholders will have an opportunity to vote on the merger agreement. If it is approved, we expect the closing to take place expeditiously, possibly even as soon as Friday, February the 25th. Once the transaction closes, R&D will become a private company for the first time since 1956. Let's now turn to our financial results. For the fourth quarter, we reported a 1.9% increase in organic sales, which marks our third consecutive quarter of organic growth. On a segment basis, business services grew 1.1% organically, driven by increased demand in commercial print, labels, and statements product categories. Marketing solutions achieved 4.9% organic growth for the quarter, primarily due to stronger client demand in our direct marketing and digital print product categories. Through the combination of organic sales growth and our ongoing cost management efforts, we reported 96.4 million in adjusted income from operations in the quarter, which is an increase of 2% versus the prior year. Similar to our third quarter results, our fourth quarter adjusted IPO in operating margin also exceeded our 2019 pre-pandemic performance. For the full year, We delivered very strong operational and financial performance, highlighted by a 3.2% increase in organic sales, a 6.9% increase in adjusted income from operations, and a 20 basis point improvement in adjusted operating margin. To provide additional context on our full year earnings performance, Our 2021 adjusted income from operations and operating margin mark our third consecutive year of improved performance. Additionally, they also represent our best annual performance for those metrics since 2016. On the balance sheet, our total debt outstanding of $1.47 billion. Gross leverage of 3.6 times and net leverage of 2.9 times were all favorable to the prior year, and each of those metrics are also at their lowest levels since the spin in 2016. Our 2021 performance is a direct testament to the R&D team's continued execution of our strategic priorities to strengthen our core, drive revenue growth, and improve financial flexibility. Our sales and marketing teams are delivering improved client to customer connections, generating new client wins, and expanding existing client relationships. Our operating teams are providing superior products and services to our clients while continually assessing and improving our work processes to drive client satisfaction and improve efficiencies across all of our businesses. Importantly, our operating teams also delivered another stellar year of safety performance. I'm especially proud of our 2021 results, given the ongoing pandemic and supply chain related disruptions we are facing. And the RRD team is aggressively managing through these challenges and is well positioned for continued success going forward. At the end of 2021, we also mitigated a ransomware cyber attack as a result of a systems intrusion. We are making steady progress in recovering from the cyber attack due to the incredible efforts of all of the RRD employees who have worked tirelessly to manage this unprecedented event. I want to extend my sincerest appreciation to our clients and employees for their patience and support as we swiftly investigated and restored systems to minimize business disruption. Over the past few quarters, we have highlighted some of the many awards and recognitions our team has received, and we're especially proud of those acknowledging RD as a workplace where each and every one of our employees feel they belong and have the opportunity to reach their full potential. As a testament to our inclusive culture, we received a score of 95 out of 100 on the Human Rights Campaign Foundation's 2022 Corporate Equality Index, the nation's foremost benchmarking survey and report measuring corporate policies and practices related to LGBTQ plus workplace equality. With that, I'd like to turn the call over to Terry to provide more detail on our financial results for the fourth quarter. Terry, over to you.