Quad/Graphics Reports Preliminary 2015 Results, 2016 Guidance; Shares Spike

Shares of Quad/Graphics, Inc. QUAD were trading higher by more than 7 percent Thursday morning after the company reported preliminary fiscal 2015 guidance and offered encouraging 2016 guidance.

Quad/Graphics said that it expects its full year fiscal 2015 EBITDA to be at least $460 million, exceeding the high end of its previous guidance range by $10 million. The company noted its improved outlook is attributed to a $100 million cost reduction program which was completed earlier than expected.

Quad/Graphics also expects its net sales for the full year 2015 to be approximately $4.65 billion and free cash flow of approximately $210 million.

Looking forward to 2016, Quad/Graphics expects its net sales to be in a range of $4.4 billion to $4.6 billion, EBITDA of $420 million to $460 million and free cash flow of $190 million to $230 million.

"We believe Quad/Graphics will continue to be a significant Free Cash Flow generator into the future and, because of permanent improvements to our cost structure and working capital levels, our preliminary financial guidance for 2016 demonstrates our ability to deliver a sustainable level of Free Cash Flow," Dave Honan, Quad/Graphics Executive Vice President & Chief Financial Officer, concluded. "Our strong cash flow and disciplined capital deployment strategy provides us the ability to continue maintaining a strong balance sheet, including further deleveraging the balance sheet through debt and pension liability reductions, while continuing to invest strategically in our business and return cash to our shareholders through our dividend, representing only 30% of our annual Free Cash Flow."