Multi Packaging Solutions Announces First Quarter Results
Multi Packaging Solutions International Limited announced results for its first quarter ended September 30, 2016.
Marc Shore, Chief Executive Officer, commented, “As we expected, the first quarter was challenging due to the headwinds that were previously discussed: continued negative impact of foreign exchange rates, the discontinuation of a specific toy program, the exit from the tobacco business and the continued decline in multimedia sales. Furthermore, we continued to struggle at four facilities, and some of our core customers had weaker sales than budgeted. As previously noted, we will cycle through all of these challenges by the end of our fiscal second quarter, except for foreign exchange and media declines.
Notwithstanding these headwinds, there were significant accomplishments in the quarter. We have a robust pipeline of new business which we will start benefiting from in early 2017. This is driven in part by our ability to give customers consistently high quality products on a global basis. MPS has also completed two strategic acquisitions in October and November that will enhance our offering for both labels in Europe and transaction cards in North America. These acquisitions currently have combined annual revenue of $25 million.
MPS has also taken several steps that are important to our future success:
- The completion of our debt refinancing which will result in lower annual cash interest costs of approximately $10 million.
- The final funding payment under the UK Pension Funding Arrangement was made, which will save approximately $9 million cash annually.
- Progress in streamlining our operational footprint. We have internally announced the closure of three facilities and by June 30th 2017, we expect to close a total of six facilities. This will result in approximately $20 million in savings annually.
- Progress in our supply chain rationalization.
In summary, the first half of fiscal 2017 will be challenging. However, we are confident that the new sales pipeline, significant cost cutting measures, optimization of footprint, and strategic acquisitions will create momentum in the fiscal second half and drive our future growth and success.”