Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2023 | Apr. 27, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-08454 | |
Entity Registrant Name | ACCO Brands Corporation | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 36-2704017 | |
Entity Address, Address Line One | Four Corporate Drive | |
Entity Address, City or Town | Lake Zurich | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60047 | |
City Area Code | 847 | |
Local Phone Number | 541-9500 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | ACCO | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 94,917,374 | |
Entity Central Index Key | 0000712034 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 127.1 | $ 62.2 |
Accounts receivable, net | 303.8 | 384.1 |
Inventories | 422.5 | 395.2 |
Other current assets | 41.2 | 40.8 |
Total current assets | 894.6 | 882.3 |
Total property, plant and equipment | 594.7 | 589.2 |
Less: accumulated depreciation | (414.8) | (404.1) |
Property, plant and equipment, net | 179.9 | 185.1 |
Right of use asset, leases | 87.4 | 88.8 |
Deferred income taxes | 101.2 | 99.7 |
Goodwill | 671.9 | 671.5 |
Identifiable intangibles, net | 842.4 | 847 |
Other non-current assets | 15.4 | 20.3 |
Total assets | 2,792.8 | 2,794.7 |
Current liabilities: | ||
Notes payable | 9.1 | 10.3 |
Current portion of long-term debt | 47.3 | 49.7 |
Accounts payable | 204.5 | 239.5 |
Accrued compensation | 31.9 | 38.3 |
Accrued customer program liabilities | 74.2 | 103.3 |
Lease liabilities | 21.1 | 21.2 |
Other current liabilities | 116.3 | 126.7 |
Total current liabilities | 504.4 | 589 |
Long-term debt, net | 1,035 | 936.5 |
Long-term lease liabilities | 73.8 | 75.2 |
Deferred income taxes | 137.3 | 144.1 |
Pension and post-retirement benefit obligations | 152.9 | 155.5 |
Other non-current liabilities | 79.6 | 84.3 |
Total liabilities | 1,983 | 1,984.6 |
Stockholders' equity: | ||
Common stock | 1 | 1 |
Treasury stock | (45) | (43.4) |
Paid-in capital | 1,903.3 | 1,897.2 |
Accumulated other comprehensive loss | (533.8) | (540.3) |
Accumulated deficit | (515.7) | (504.4) |
Total stockholders' equity | 809.8 | 810.1 |
Total liabilities and stockholders' equity | $ 2,792.8 | $ 2,794.7 |
Consolidated Statements of Loss
Consolidated Statements of Loss (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Income Statement [Abstract] | |||
Net sales | $ 402.6 | $ 441.6 | |
Cost of products sold | 283.3 | 322 | |
Gross profit | 119.3 | 119.6 | |
Operating costs and expenses: | |||
Selling, general and administrative expenses | 95 | 98.8 | |
Amortization of intangibles | 10.9 | 11.1 | |
Restructuring charges | 3.3 | 0.3 | |
Change in fair value of contingent consideration | 0 | 2.6 | |
Total operating costs and expenses | 109.2 | 112.8 | |
Operating income | [1] | 10.1 | 6.8 |
Non-operating expense (income): | |||
Interest expense | 13.9 | 9.7 | |
Interest income | (2.4) | (1.4) | |
Non-operating pension expense (income) | 0.1 | (1.4) | |
Other expense, net | 1.8 | 0.9 | |
Loss before income tax | (3.3) | (1) | |
Income tax expense | 0.4 | 1.7 | |
Net loss | $ (3.7) | $ (2.7) | |
Per share: | |||
Basic loss per share | $ (0.04) | $ (0.03) | |
Diluted loss per share | $ (0.04) | $ (0.03) | |
Weighted average number of shares outstanding: | |||
Basic (in shares) | 94.9 | 96.2 | |
Diluted (in shares) | [2] | 94.9 | 96.2 |
[1] Operating income is defined as i) net sales; ii) less cost of products sold; iii) less selling, general and administrative expenses; iv) less amortization of intangibles; v) less restructuring charges; and vi) less change in the fair value of contingent consideration. Due to the net loss during the three months ended March 31, 2023, the denominator in the diluted earnings per share calculation does not include the effects of the stock awards for which the average market price for the period exceeds the exercise price, as it would result in a less dilutive computation. As a result, reporting diluted earnings per share for the three months ended March 31, 2023 are the same as basic earnings per share. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (3.7) | $ (2.7) |
Other comprehensive (loss) income, net of tax: | ||
Unrealized loss on derivative instruments, net of tax benefit of $0.3 and $0.7, respectively | (0.9) | (1.4) |
Foreign currency translation adjustments, net of tax benefit of $0.1 and $0.6, respectively | 8.9 | 15.3 |
Recognition of deferred pension and other post-retirement items, net of tax benefit (expense) of $0.4 and $(1.4), respectively | (1.5) | 4.8 |
Other comprehensive income, net of tax | 6.5 | 18.7 |
Comprehensive income | $ 2.8 | $ 16 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Unrealized loss on derivative instruments, tax benefit | $ 0.3 | $ 0.7 |
Foreign currency translation adjustments, tax benefit | 0.1 | 0.6 |
Recognition of deferred pension and other post-retirement items, tax benefit (expense) | $ 0.4 | $ (1.4) |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Operating activities | ||
Net loss | $ (3.7) | $ (2.7) |
Loss on disposal of assets | 1.1 | 0 |
Change in fair value of contingent consideration | 0 | 2.6 |
Depreciation | 9 | 9.9 |
Amortization of debt issuance costs | 0.8 | 0.7 |
Amortization of intangibles | 10.9 | 11.1 |
Stock-based compensation | 5.6 | 4.9 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 88.6 | 84.1 |
Inventories | (25) | (37.3) |
Other assets | 3.6 | (7.6) |
Accounts payable | (38) | (87.5) |
Accrued expenses and other liabilities | (63.6) | (76.5) |
Accrued income taxes | (12.5) | (5.9) |
Net cash used by operating activities | (23.2) | (104.2) |
Investing activities | ||
Additions to property, plant and equipment | (2) | (3.4) |
Net cash used by investing activities | (2) | (3.4) |
Financing activities | ||
Proceeds from long-term borrowings | 101.1 | 168 |
Repayments of long-term debt | (10) | (5) |
Repayments of notes payable, net | (1.2) | (5.3) |
Dividends paid | 0 | (7.3) |
Payments related to tax withholding for stock-based compensation | (1.7) | (1.2) |
Proceeds from the exercise of stock options | 0 | 4.3 |
Net cash provided by financing activities | 88.2 | 153.5 |
Effect of foreign exchange rate changes on cash and cash equivalents | 1.9 | 4.2 |
Net increase in cash and cash equivalents | 64.9 | 50.1 |
Cash and cash equivalents | ||
Beginning of the period | 62.2 | 41.2 |
End of the period | 127.1 | 91.3 |
Cash paid during the year for: | ||
Interest | 19.2 | 15.1 |
Income taxes | $ 13 | $ 7.6 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders’ Equity (Unaudited) - USD ($) shares in Millions, $ in Millions | Total | Common Stock | Paid-in Capital | Treasury Stock | Accumulated Other Comprehensive (Loss) Income | Accumulated Deficit |
Balance at start of period at Dec. 31, 2021 | $ 864.8 | $ 1 | $ 1,902.2 | $ (40.9) | $ (535.5) | $ (462) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (2.7) | (2.7) | ||||
Loss on derivative financial instruments, net of tax | (1.4) | (1.4) | ||||
Translation impact, net of tax | 15.3 | 15.3 | ||||
Pension and post-retirement adjustment, net of tax | 4.8 | 4.8 | ||||
Stock-based compensation | 4.8 | 4.9 | (0.1) | |||
Common stock issued, net of shares withheld for employee taxes | 3.1 | 4.3 | (1.2) | |||
Dividends declared | (7.3) | (7.3) | ||||
Other | 0.1 | 0.1 | ||||
Balance at end of period at Mar. 31, 2022 | 881.5 | $ 1 | 1,911.5 | $ (42.1) | (516.8) | (472.1) |
Balance at start of period (in shares) at Dec. 31, 2021 | 100.1 | 4.3 | ||||
Increase (Decrease) In Capital Stock [Roll Forward] | ||||||
Common stock issued, net of shares withheld for employee taxes (in shares) | 1.1 | 0.1 | ||||
Balance at end of period (in shares) at Mar. 31, 2022 | 101.2 | 4.4 | ||||
Balance at start of period at Dec. 31, 2022 | 810.1 | $ 1 | 1,897.2 | $ (43.4) | (540.3) | (504.4) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (3.7) | (3.7) | ||||
Loss on derivative financial instruments, net of tax | (0.9) | (0.9) | ||||
Translation impact, net of tax | 8.9 | 8.9 | ||||
Pension and post-retirement adjustment, net of tax | (1.5) | (1.5) | ||||
Stock-based compensation | 5.6 | 6.2 | (0.6) | |||
Common stock issued, net of shares withheld for employee taxes | (1.7) | (1.7) | ||||
Dividends declared | (7.1) | (7.1) | ||||
Other | 0.1 | (0.1) | 0.1 | 0.1 | ||
Balance at end of period at Mar. 31, 2023 | $ 809.8 | $ 1 | $ 1,903.3 | $ (45) | $ (533.8) | $ (515.7) |
Balance at start of period (in shares) at Dec. 31, 2022 | 98.9 | 4.6 | ||||
Increase (Decrease) In Capital Stock [Roll Forward] | ||||||
Common stock issued, net of shares withheld for employee taxes (in shares) | 0.9 | 0.3 | ||||
Balance at end of period (in shares) at Mar. 31, 2023 | 99.8 | 4.9 |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||
Common stock, dividends per share, declared | $ 0.075 | $ 0.075 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | 1 . Basis of Presentation As used in this Quarterly Report on Form 10-Q for the quarter ended March 31, 2023, the terms "ACCO Brands," "ACCO," the "Company," "we," "us," and "our" refer to ACCO Brands Corporation and its consolidated subsidiaries. The management of ACCO Brands Corporation is responsible for the accuracy and internal consistency of the preparation of the condensed consolidated financial statements and notes contained in this Quarterly Report on Form 10-Q. The condensed consolidated interim financial statements have been prepared pursuant to the rules and regulations of the SEC. Although the Company believes the disclosures are adequate to make the information presented not misleading, certain information and note disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the U.S. ("GAAP") have been condensed or omitted pursuant to those rules and regulations. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. The Condensed Consolidated Balance Sheet as of March 31, 2023 and the related Consolidated Statements of Loss, Consolidated Statements of Comprehensive Income, and Consolidated Statements of Stockholders' Equity for the three months ended March 31, 2023 and 2022, and the Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2023 and 2022 are unaudited. The December 31, 2022 Condensed Consolidated Balance Sheet data was derived from audited financial statements but does not include all annual disclosures required by GAAP. The financial statements included herein were prepared by management and reflect all adjustments (consisting solely of normal recurring items unless otherwise noted) which are, in the opinion of management, necessary for the fair presentation of the results of operations and cash flows for the interim periods ended March 31, 2023 and 2022, and the financial position of the Company as of March 31, 2023. Interim results may not be indicative of results for a full year. The preparation of financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported assets and liabilities at the date of the financial statements and the reported revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements and Adopted Accounting Standards | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Recent Accounting Pronouncements and Adopted Accounting Standards | 2 . Recent Accounting Pronouncements and Adopted Accounting Standards Recent Accounting Pronouncements There are no recently issued accounting pronouncements that are expected to have an impact on the Company’s financial condition, results of operations or cash flow. Recently Adopted Accounting Standards In March 2020, the Financial Accounting Standards Board ("FASB") issued ASU 2020-04, Reference Rate Reform (Topic 848), which provides optional expedients and exceptions for applying current GAAP to contracts, hedging relationships, and other transactions affected by the transition from the use of LIBOR to an alternative reference rate. Effective in the fourth quarter of 2022, the Company adopted this standard. The adoption of this standard did not have a material impact on our consolidated financial statements. There were no accounting standards that were adopted in the first three months of 2023 that had a material effect on the Company’s financial condition, results of operations or cash flow. |
Long-term Debt and Short-term B
Long-term Debt and Short-term Borrowings | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Long-term Debt and Short-term Borrowings | 4.50 to 1.00 2.50 % 1.50 % 0.500 %
≤ 4.50 to 1.00 and > 4.00 to 1.00 2.25 % 1.25 % 0.375 %
≤ 4.00 to 1.00 and > 3.50 to 1.00 2.00 % 1.00 % 0.350 %
≤ 3.50 to 1.00 and > 3.00 to 1.00 1.75 % 0.75 % 0.300 %
≤ 3.00 to 1.00 and > 2.00 to 1.00 1.50 % 0.50 % 0.250 %
≤ 2.00 to 1.00 1.25 % 0.25 % 0.200 % As of March 31, 2023, there was $ 168.5 million in borrowings outstanding under the Revolving Facility. The remaining amount available for borrowings was $ 419.6 million (allowing for $ 11.9 million of letters of credit outstanding on that date). As of March 31, 2023, our Consolidated Leverage Ratio was approximately 4.30 to 1.00 versus our maximum covenant of 5.00 to 1.00. Senior Unsecured Notes On March 15, 2021, the Company completed a private offering of $ 575.0 million in aggregate principal amount of 4.25 percent Senior Unsecured Notes (the "Notes") due March 2029. Interest on the Notes is payable semiannually on March 15 and September 15 of each year. The Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by each of the Company's existing and future U.S. subsidiaries, other than certain excluded subsidiaries. Guarantees and Security Generally, obligations under the Credit Agreement are guaranteed by certain of the Company’s existing and future subsidiaries, and are secured by substantially all of the Company’s and certain guarantor subsidiaries’ assets, subject to certain exclusions and limitations." id="sjs-B4">3 . Long-term Debt and Short-term Borrowings Notes payable and long-term debt, listed in order of the priority of security interests in assets of the Company, consisted of the following as of March 31, 2023 and December 31, 2022: (in millions) March 31, December 31, Euro Senior Secured Term Loan A, due March 2026 (floating interest rate of 5.27 % at March 31, 2023 and 3.90 % at December 31, 2022) $ 229.4 $ 227.4 USD Senior Secured Term Loan A, due March 2026 (floating interest rate of 7.18 % at March 31, 2023 and 6.40 % at December 31, 2022) 83.3 84.4 Australian Dollar Senior Secured Term Loan A, due March 2026 (floating interest rate of 6.00 % at March 31, 2023 and 5.30 % at December 31, 2022) 34.1 34.9 U.S. Dollar Senior Secured Revolving Credit Facility, due March 2026 (floating interest rate of 7.17 % at March 31, 2023 and 6.36 % at December 31, 2022) 148.4 58.6 Australian Dollar Senior Secured Revolving Credit Facility, due March 2026 (floating interest rate of 5.84 % at March 31, 2023 and 5.18 % at December 31, 2022) 20.1 14.2 Senior Unsecured Notes, due March 2029 (fixed interest rate of 4.25 %) 575.0 575.0 Other borrowings 9.1 10.4 Total debt 1,099.4 1,004.9 Less: Current portion 56.4 60.0 Debt issuance costs, unamortized 8.0 8.4 Long-term debt, net $ 1,035.0 $ 936.5 Credit Agreement The Company is party to a Third Amended and Restated Credit Agreement (the "Credit Agreement"), dated as of January 27, 2017, among the Company, certain subsidiaries of the Company, Bank of America, N.A., as administrative agent, and the other agents and various lenders party thereto. The Credit Agreement, as amended, provides for a five-year senior secured credit facility, which consists of a € 300.0 million (US$ 320.8 million based on January 27, 2017, exchange rates) term loan facility, an A$ 80.0 million (US$ 60.4 million based on January 27, 2017, exchange rates) term loan facility, a US$ 100.0 million term loan facility, and a US$ 600.0 million multi-currency revolving credit facility (the "Revolving Facility"). From July 2018 to November 2022, the Company entered into six amendments (the "Amendments") to the Credit Agreement. The following are the key changes, among other things, to the Credit Agreement as a result of the Amendments: • replace the minimum fixed coverage ratio of 1.25 :1.00 with a minimum Interest Coverage Ratio (as defined in the Credit Agreement) of 3.00 :1.00; • increase the maximum Consolidated Leverage Ratio (as defined in the Credit Agreement) financial covenant for each of the five fiscal quarters beginning December 31, 2022, and ending December 31, 2023, as follows: Quarter Ended Maximum Consolidated Leverage Ratio December 2022 4.50 :1.00 March 2023 5.00 :1.00 June 2023 5.00 :1.00 September 2023 4.75 :1.00 December 2023 4.25 :1.00 • modify the maximum Consolidated Leverage Ratio financial covenant for all first and second fiscal quarters after December 31, 2023, from the current level of 4.00x to 4.50x, while maintaining the current level of 4.00x for all third and fourth fiscal quarters; • limit the maximum Consolidated Leverage Ratio to 5.00 :1.00 at any time, thereby capping any material acquisition step ups for the fiscal quarters ending March 31, 2023, June 30, 2023 and September 30, 2023; • increase the Company’s flexibility under the restricted payments baskets; and • change the U.S. dollar reference rate from LIBOR-based pricing to SOFR-based pricing, with no changes to existing margins. The current maturity of the Credit Agreement is March 31, 2026 and the current pricing is as follows: Consolidated Leverage Ratio Applicable Rate on Euro/AUD/CDN Dollar Loans Applicable Rate on Base Rate Loans Undrawn Fee > 4.50 to 1.00 2.50 % 1.50 % 0.500 % ≤ 4.50 to 1.00 and > 4.00 to 1.00 2.25 % 1.25 % 0.375 % ≤ 4.00 to 1.00 and > 3.50 to 1.00 2.00 % 1.00 % 0.350 % ≤ 3.50 to 1.00 and > 3.00 to 1.00 1.75 % 0.75 % 0.300 % ≤ 3.00 to 1.00 and > 2.00 to 1.00 1.50 % 0.50 % 0.250 % ≤ 2.00 to 1.00 1.25 % 0.25 % 0.200 % As of March 31, 2023, there was $ 168.5 million in borrowings outstanding under the Revolving Facility. The remaining amount available for borrowings was $ 419.6 million (allowing for $ 11.9 million of letters of credit outstanding on that date). As of March 31, 2023, our Consolidated Leverage Ratio was approximately 4.30 to 1.00 versus our maximum covenant of 5.00 to 1.00. Senior Unsecured Notes On March 15, 2021, the Company completed a private offering of $ 575.0 million in aggregate principal amount of 4.25 percent Senior Unsecured Notes (the "Notes") due March 2029. Interest on the Notes is payable semiannually on March 15 and September 15 of each year. The Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by each of the Company's existing and future U.S. subsidiaries, other than certain excluded subsidiaries. Guarantees and Security Generally, obligations under the Credit Agreement are guaranteed by certain of the Company’s existing and future subsidiaries, and are secured by substantially all of the Company’s and certain guarantor subsidiaries’ assets, subject to certain exclusions and limitations. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Leases | 4 . Leases The Company leases its corporate headquarters, various other facilities for distribution, manufacturing, and offices, as well as vehicles, forklifts and other equipment. The Company determines if an arrangement is a lease at inception. Leases are included in "Right of use asset, leases" ("ROU Assets"), and the current portion of the lease liability is included in "Lease liabilities" and the non-current portion is included in "Long-term lease liabilities" in the Condensed Consolidated Balance Sheets. The Company currently has an immaterial amount of financing leases and leases with terms of more than one month and less than 12 months. ROU Assets and Lease liabilities are recognized based on the present value of lease payments over the lease term. Because most of the Company’s leases do not provide an implicit rate of return, the Company uses its incremental collateralized borrowing rate, on a regional basis, in determining the present value of lease payments. The incremental borrowing rate is dependent upon the duration of the lease and has been segmented into three groups of time. All leases within the same region and the same group of time share the same incremental borrowing rate. The Company has lease agreements with lease and non-lease components, which are combined for accounting purposes for all classes of underlying assets except information technology equipment. The components of lease expense were as follows: Three Months Ended (in millions) 2023 2022 Operating lease cost $ 7.0 $ 7.7 Sublease income ( 0.6 ) ( 0.6 ) Total lease cost $ 6.4 $ 7.1 Other information related to leases was as follows: Three Months Ended (in millions, except lease term and discount rate) 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 7.4 $ 8.5 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 3.4 $ 5.2 Weighted average remaining lease term: Operating leases 6.1 years Weighted average discount rate: Operating leases 4.6 % Future minimum lease payments, net of sublease income, for all non-cancelable leases as of March 31, 2023, were as follows: (in millions) Operating 2023 $ 19.2 2024 20.9 2025 17.6 2026 13.9 2027 9.4 2028 8.9 Thereafter 20.4 Total minimum lease payments 110.3 Less imputed interest 15.4 Future minimum payments for leases, net of sublease rental income and imputed interest $ 94.9 |
Pension and Other Retiree Benef
Pension and Other Retiree Benefits | 3 Months Ended |
Mar. 31, 2023 | |
Retirement Benefits [Abstract] | |
Pension and Other Retiree Benefits | 5 . Pension and Other Retiree Benefits The components of net periodic benefit (income) cost for pension and post-retirement plans for the three months ended March 31, 2023 and 2022 were as follows: Three Months Ended March 31, Pension Post-retirement U.S. International (in millions) 2023 2022 2023 2022 2023 2022 Service cost $ — $ — $ 0.1 $ 0.3 $ — $ — Interest cost 2.0 1.2 4.9 2.5 — — Expected return on plan assets ( 3.0 ) ( 2.7 ) ( 5.3 ) ( 4.6 ) — — Amortization of net loss (gain) 0.6 0.9 1.0 1.4 ( 0.1 ) ( 0.1 ) Amortization of prior service cost — — 0.1 — — — Net periodic benefit (income) cost (1) $ ( 0.4 ) $ ( 0.6 ) $ 0.8 $ ( 0.4 ) $ ( 0.1 ) $ ( 0.1 ) (1) The components of net periodic benefit (income) cost, other than service cost, are included in the line "Non-operating pension expense (income)" in the Consolidated Statements of Loss. We expect to contribute approximately $ 16.9 million to our defined benefit plans in 2023. For the three months ended March 31, 2023, we have contributed $ 4.5 million to these plans. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | 6 . Stock-Based Compensation The following table summarizes our stock-based compensation expense (including stock options, restricted stock units ("RSUs") and performance stock units ("PSUs")) for the three months ended March 31, 2023 and 2022: Three months ended (in millions) 2023 2022 Stock option compensation expense $ 1.9 $ 2.1 RSU compensation expense 2.3 2.1 PSU compensation expense 1.4 0.7 Total stock-based compensation expense $ 5.6 $ 4.9 We generally recognize compensation expense for stock-based awards ratably over the vesting period. During the first quarter of 2023, stock compensation grants were made consisting of 1,647,434 RSUs and 2,154,290 PSUs. The following table summarizes our unrecognized compensation expense and the weighted-average period over which the expense will be recognized as of March 31, 2023: March 31, 2023 (in millions, except weighted average years) Unrecognized Compensation Expense Weighted Average Years Expense To Be Recognized Over Stock options $ 1.7 1.7 RSUs $ 4.9 2.7 PSUs $ 10.2 2.3 |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | 7 . Inventories The components of inventories were as follows: (in millions) March 31, 2023 December 31, 2022 Raw materials $ 90.3 $ 76.8 Work in process 4.6 4.4 Finished goods 327.6 314.0 Total inventories $ 422.5 $ 395.2 |
Goodwill and Identifiable Intan
Goodwill and Identifiable Intangible Assets | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Identifiable Intangible Assets | 8 . Goodwill and Identifiable Intangible Assets Goodwill We test goodwill for impairment at least annually as of our measurement date of May 31st and on an interim basis if an event or circumstance indicates that it is more likely than not that an impairment loss has been incurred. We did not identify a triggering event during the three months ended March 31, 2023, that would indicate it is more likely than not that an impairment loss has been incurred. We believe the assumptions used in our goodwill impairment analysis are appropriate and result in reasonable estimates of the implied fair value of each reporting unit. However, given the economic environment and the uncertainties regarding the impact on our business, there can be no assurance that our estimates and assumptions, made for purposes of our goodwill impairment testing, will prove to be an accurate prediction of the future. If our assumptions regarding future performance are not achieved, we may be required to record additional goodwill impairment charges in future periods. Estimating the fair value of each reporting unit requires us to make assumptions and estimates regarding our future. We utilized a combination of both a discounted cash flows and market approach. The financial projections used in the valuation models reflected management's assumptions regarding revenue growth rates, economic and market trends, cost structure, discount rate, and other expectations about the anticipated short-term and long-term operating results for each of our three reporting units. Changes in the net carrying amount of goodwill by segment were as follows: (in millions) ACCO Brands North America ACCO Brands EMEA ACCO Brands International Total Balance at December 31, 2022 $ 348.0 $ 145.6 $ 177.9 $ 671.5 Foreign currency translation — ( 0.2 ) 0.6 0.4 Balance at March 31, 2023 $ 348.0 $ 145.4 $ 178.5 $ 671.9 Identifiable Intangible Assets The gross carrying value and accumulated amortization by class of identifiable intangible assets as of March 31, 2023 and December 31, 2022, were as follows: March 31, 2023 December 31, 2022 (in millions) Gross Carrying Amounts Accumulated Amortization Net Book Value Gross Carrying Amounts Accumulated Amortization Net Book Value Indefinite-lived intangible assets: Trade names (1) $ 295.1 $ ( 44.5 ) $ 250.6 $ 410.6 $ ( 44.5 ) $ 366.1 Amortizable intangible assets: Trade names 491.0 ( 127.9 ) 363.1 369.7 ( 123.0 ) 246.7 Customer and contractual relationships 359.5 ( 204.7 ) 154.8 356.9 ( 198.2 ) 158.7 Vendor relationships 82.4 ( 12.6 ) 69.8 82.4 ( 11.2 ) 71.2 Patents 8.2 ( 4.1 ) 4.1 8.1 ( 3.8 ) 4.3 Subtotal 941.1 ( 349.3 ) 591.8 817.1 ( 336.2 ) 480.9 Total identifiable intangibles $ 1,236.2 $ ( 393.8 ) $ 842.4 $ 1,227.7 $ ( 380.7 ) $ 847.0 (1) Accumulated amortization prior to the adoption of authoritative guidance on goodwill and other intangible assets, at which time further amortization ceased. The Company's intangible amortization expense for the three months ended March 31, 2023 and 2022 was $ 10.9 million and $ 11.1 million , respectively. Estimated amortization expense for amortizable intangible assets, as of March 31, 2023, for the current year and the next five years is as follows: (in millions) 2023 2024 2025 2026 2027 2028 Estimated amortization expense (2) $ 43.6 $ 42.0 $ 40.4 $ 38.3 $ 35.9 $ 33.7 (2) Actual amounts of amortization expense may differ from estimated amounts due to changes in foreign currency exchange rates, additional intangible asset acquisitions, impairment of intangible assets, accelerated amortization of intangible assets and other events. We test indefinite-lived intangibles for impairment at least annually as of our measurement date of May 31st and on an interim basis if an event or circumstance indicates that it is more likely than not that an impairment loss has been incurred. We did not identify a triggering event during the three months ended March 31, 2023, that would indicate it is more likely than not that an impairment loss has been incurred. Estimating the fair value of each indefinite-lived intangible requires us to make assumptions and estimates regarding our future. We utilize a relief-from-royalty discounted cash flows approach to estimate fair values. Key inputs and assumptions involved include the estimated near-term revenue growth, long-term growth rate, royalty rate, and discount rate. As of December 31, 2022, we changed the indefinite-lived Leitz ® trade name to an amortizable intangible asset. The change was made as a result of decisions regarding the Company's future use of the trade name. The Company began amortizing the Leitz ® trade name on a straight-line basis over a life of 30 years effective January 1, 2023. |
Restructuring
Restructuring | 3 Months Ended |
Mar. 31, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | 9 . Restructuring The Company recorded $ 3.3 million and $ 0.3 million of restructuring expense for the three months ended March 31, 2023 and 2022, respectively. Restructuring expenses for the three months ended March 31, 2023, were primarily for severance costs related to cost reduction initiatives in our EMEA and International segments. The summary of the activity in the restructuring liability for the three months ended March 31, 2023, was as follows: Balance at Non-cash Items / Balance at (in millions) December 31, Provision Cash Currency March 31, Employee termination costs (1) $ 8.7 $ 2.7 $ ( 2.6 ) $ 0.1 $ 8.9 Other (2) — 0.6 — — 0.6 Total restructuring liability $ 8.7 $ 3.3 $ ( 2.6 ) $ 0.1 $ 9.5 (1) We expect the remaining $ 8.9 million employee termination costs to be substantially paid in the next twelve months . (2) We expect the remaining $ 0.6 million of other costs to be substantially paid in the next twelve months . The summary of the activity in the restructuring liability for the three months ended March 31, 2022, was as follows: Balance at Non-cash Items / Balance at (in millions) December 31, Provision Cash Currency March 31, Employee termination costs $ 3.4 $ 0.3 $ ( 1.0 ) $ — $ 2.7 Termination of lease agreements 1.1 — ( 0.6 ) — 0.5 Total restructuring liability $ 4.5 $ 0.3 $ ( 1.6 ) $ — $ 3.2 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 10 . Income Taxes For the three months ended March 31, 2023, we recorded income tax expense of $ 0.4 million on a loss before taxes of $ 3.3 million . For the three months ended March 31, 2022, we recorded income tax expense of $ 1.7 million on a loss before taxes of $ 1.0 million . The $ 1.3 million decrease in tax expense compared to the three months ended March 31, 2022 was primarily driven by a $ 1.2 million decrease in discrete income tax expense during the first quarter of 2023 compared to the first quarter of 2022. The U.S. federal statute of limitations remains open for the years 2019 and forward. Foreign and U.S. state jurisdictions have statutes of limitations generally ranging from 2 to 5 years. Years still open to examination by foreign tax authorities in major jurisdictions include Australia ( 2018 forward), Brazil ( 2016 forward), Canada ( 2018 forward), Germany ( 2017 forward), Sweden ( 2017 forward) and the U.K. ( 2020 forward). We are currently under examination in certain foreign jurisdictions. Brazil Tax Assessments In connection with our May 1, 2012, acquisition of the Mead Consumer and Office Products business ("Mead C&OP"), we assumed all of the tax liabilities for the acquired foreign operations including its operating entity in Brazil ("ACCO Brazil"). In December of 2012, the Federal Revenue Department of the Ministry of Finance of Brazil ("FRD") issued a tax assessment against ACCO Brazil, challenging the tax deduction of goodwill from ACCO Brazil's taxable income for the year 2007 (the "First Assessment"). A second assessment challenging the deduction of goodwill from ACCO Brazil's taxable income for the years 2008, 2009 and 2010 was issued by FRD in October 2013 (the "Second Assessment" and together with the First Assessment, the "Brazil Tax Assessments"). The final administrative appeal of the Second Assessment was decided against the Company in 2017. In 2018, we challenged this decision to the first judicial level. In the fourth quarter of 2022, this case was decided against the Company by the first level judicial court. We have appealed this decision to the second judicial level. In the event we do not prevail at the judicial level, we will be required to pay an additional penalty representing attorneys' costs and fees; accordingly, in the first quarter of 2019, the Company recorded an additional reserve in the amount of $ 5.6 million. In connection with the judicial challenge, we were required to provide security to guarantee payment of the Second Assessment should we not prevail. In the third quarter of 2020, the final administrative appeal of the First Assessment was decided against the Company and we determined that we would challenge this decision. In 2022, we challenged this adverse decision in the tax authority's lawsuit at the judicial level seeking to collect the tax. In connection with the judicial challenge, we were required to provide security to guarantee payment of the First Assessment should we not prevail. We believe we have meritorious defenses and intend to vigorously contest both of the Brazil Tax Assessments; however, there can be no assurances that we will ultimately prevail. The ultimate outcome will not be determined until the Brazilian judicial process is complete. It is possible we could have a final decision regarding the Second Assessment in the next nine months to three years. If the FRD's initial position is ultimately sustained, payment of the amount assessed would materially and adversely affect our cash flow in the year of settlement. Because there is no settled legal precedent on which to base a definitive opinion as to whether we will ultimately prevail, we consider the outcome of these disputes to be uncertain. Since it is not more likely than not that we will prevail, in 2012, we recorded a reserve in the amount of $ 44.5 million (at December 31, 2012 exchange rates) in consideration of this contingency, of which $ 43.3 million was recorded as an adjustment to the purchase price and which included the 2007-2012 tax years plus penalties and interest through December 2012. Because the Brazilian courts have determined that we will have to pay the standard penalty of 75 percent if we do not prevail, we have used this assumption in the reserve calculation. We will continue to actively monitor administrative and judicial court decisions and evaluate their impact, if any, on our legal assessment of the ultimate outcome of our disputes. In addition, we will continue to accrue interest related to this contingency until such time as the outcome is known or until evidence is presented that we are more likely than not to prevail. During the three months ended March 31, 2023 and 2022, we accrued additional interest as a charge to current income tax expense of $ 0.4 million and $ 0.3 million, respectively. At current exchange rates, our accrual through March 31, 2023, including tax, penalties and interest is $ 32.0 million (reported in "Other non-current liabilities"). |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Earnings per Share | 11 . Earnings per Share Total outstanding shares as of March 31, 2023 and 2022, were 94.9 million and 96.8 million , respectively. For the three months ended March 31, 2023 and 2022, we acquired 0.3 million and 0.2 million shares, respectively, related to tax withholding for share-based compensation. The calculation of basic earnings per share of common stock is based on the weighted-average number of shares of common stock outstanding in the year, or period, over which they were outstanding. Our calculation of diluted earnings per share of common stock assumes that any shares of common stock outstanding were increased by shares that would be issued upon exercise of those stock awards for which the average market price for the period exceeds the exercise price less the shares that could have been purchased by the Company with the related proceeds, including compensation expense measured but not yet recognized. The number of our weighted-average shares outstanding for the three months ended March 31, 2023 and 2022 was as follows: Three Months Ended March 31, (in millions) 2023 2022 Weighted-average number of shares of common stock outstanding - basic 94.9 96.2 Stock options — — Restricted stock units — — Weighted-average shares and assumed conversions - diluted (1) 94.9 96.2 (1) Due to the net loss during the three months ended March 31, 2023, the denominator in the diluted earnings per share calculation does not include the effects of the stock awards for which the average market price for the period exceeds the exercise price, as it would result in a less dilutive computation. As a result, reporting diluted earnings per share for the three months ended March 31, 2023 are the same as basic earnings per share. Awards of potentially dilutive shares of common stock, which have exercise prices that were higher than the average market price during the period, are not included in the computation of dilutive earnings per share as their effect would have been anti-dilutive. For the three months ended March 31, 2023 and 2022 the number of anti-dilutive shares was approximately 11.5 million and 9.3 million , respectively. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | 12 . Derivative Financial Instruments We are exposed to various market risks, including changes in foreign currency exchange rates and interest rate changes. We enter into financial instruments to manage and reduce the impact of these risks, not for trading or speculative purposes. The counterparties to these financial instruments are major financial institutions. We continually monitor our foreign currency exposures in order to maximize the overall effectiveness of our foreign currency hedge positions. Principal currencies hedged against the U.S. dollar include the Euro, Australian dollar, Canadian dollar, Swedish krona, British pound and Japanese yen. We are subject to credit risk, which relates to the ability of counterparties to meet their contractual payment obligations or the potential non-performance by counterparties to financial instrument contracts. Management continues to monitor the status of our counterparties and will take action, as appropriate, to further manage our counterparty credit risk. There are no credit contingency features in our derivative financial instruments. When hedge accounting is applicable, on the date we enter into a derivative, the derivative is designated as a hedge of the identified exposure. We measure the effectiveness of our hedging relationships both at hedge inception and on an ongoing basis. Forward Currency Contracts We enter into forward foreign currency contracts with third parties to reduce the effect of fluctuating foreign currencies, primarily on foreign denominated inventory purchases and intercompany loans. Our primary exposure to currency movements is in the Euro, the Swedish krona, the British pound, the Brazilian real, the Australian dollar, the Canadian dollar, and the Mexican peso. Forward currency contracts are used to hedge foreign denominated inventory purchases for Europe, Australia, Canada, Japan and New Zealand, and are designated as cash flow hedges. Unrealized gains and losses on these contracts are deferred in Accumulated Other Comprehensive Income ("AOCI") until the contracts are settled and the underlying hedged transactions relating to inventory purchases are recognized, at which time the deferred gains or losses will be reported in the "Cost of products sold" line in the Consolidated Statements of Operations. As of March 31, 2023 and December 31, 2022 , we had cash flow foreign exchange contracts outstanding with a U.S. dollar equivalent notional value of $ 82.2 million and $ 108.3 million, respectively, which were designated as hedges. Forward currency contracts used to hedge foreign denominated intercompany loans are not designated as hedging instruments. Gains and losses on these derivative instruments are recognized within "Other expense (income), net" in the Consolidated Statements of Operations and are largely offset by the change in the current translated value of the hedged item. The periods of the forward foreign exchange contracts correspond to the periods of the hedged transactions, with some relating to intercompany loans which extend beyond March 2024. As of March 31, 2023 and December 31, 2022 , we had foreign exchange contracts outstanding with a U.S. dollar equivalent notional value of $ 95.1 million and $ 79.5 million, respectively, which were not designated as hedges. The following table summarizes the fair value of our derivative financial instruments as of March 31, 2023 and December 31, 2022: Fair Value of Derivative Instruments Derivative Assets Derivative Liabilities (in millions) Balance Sheet Location March 31, December 31, Balance Sheet Location March 31, December 31, Derivatives designated as hedging instruments: Foreign exchange contracts Other current assets $ 1.7 $ 3.6 Other current liabilities $ 1.1 $ 1.9 Derivatives not designated as hedging instruments: Foreign exchange contracts Other current assets 0.4 0.7 Other current liabilities 0.6 0.7 Foreign exchange contracts Other non-current assets 0.2 4.9 Other non-current liabilities 0.2 4.9 Total derivatives $ 2.3 $ 9.2 $ 1.9 $ 7.5 The following tables summarize the pre-tax effect of our derivative financial instruments on the condensed consolidated financial statements for the three months ended March 31, 2023 and 2022: The Effect of Derivative Instruments in Cash Flow Hedging Relationships on the Consolidated Financial Statements Amount of Gain (Loss) Recognized in AOCI (Effective Portion) Location of (Gain) Loss Reclassified from AOCI to Income Amount of (Gain) Loss Reclassified from AOCI to Income (Effective Portion) Three Months Ended March 31, Three Months Ended March 31, (in millions) 2023 2022 2023 2022 Cash flow hedges: Foreign exchange contracts $ ( 0.6 ) $ ( 0.2 ) Cost of products sold $ ( 0.5 ) $ ( 2.4 ) The Effect of Derivatives Not Designated as Hedging Instruments on the Consolidated Statements of (Loss) Income Location of (Gain) Loss Recognized in Income on Derivatives Amount of (Gain) Loss Recognized in Income Three Months Ended (in millions) 2023 2022 Foreign exchange contracts Other expense, net $ 1.7 $ ( 0.6 ) |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 13 . Fair Value of Financial Instruments In establishing a fair value, there is a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The basis of the fair value measurement is categorized in three levels, in order of priority, as described below: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities Level 2 Unadjusted quoted prices in active markets for similar assets or liabilities, or Unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or Inputs other than quoted prices that are observable for the asset or liability Level 3 Unobservable inputs for the asset or liability We utilize the best available information in measuring fair value. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. We have determined that our financial assets and liabilities described in "Note 12 . Derivative Financial Instruments" are Level 2 in the fair value hierarchy. The following table sets forth our financial assets and liabilities that were accounted for at fair value on a recurring basis as of March 31, 2023 and December 31, 2022: (in millions) March 31, December 31, Assets: Forward currency contracts $ 2.3 $ 9.2 Liabilities: Forward currency contracts $ 1.9 $ 7.5 Our forward currency contracts are included in "Other current assets," "Other current liabilities," "Other non-current assets," or "Other non-current liabilities." The forward foreign currency exchange contracts are primarily valued based on the foreign currency spot and forward rates quoted by banks or foreign currency dealers. As such, these derivative instruments are classified within Level 2. The fair values of cash and cash equivalents, notes payable to banks, accounts receivable and accounts payable approximate carrying amounts due principally to their short maturities. The carrying amount of total debt was $ 1,099.4 million and $ 1,004.9 million and the estimated fair value of total debt was $ 1,001.6 million and $ 910.0 million at March 31, 2023 and December 31, 2022, respectively. The fair values are determined from quoted market prices, where available, and from using current interest rates based on credit ratings and the remaining terms of maturity. Nonrecurring Fair Value Measurements On a nonrecurring basis, we remeasure the fair value of the goodwill of our reporting units and our trade name indefinite-lived intangibles if an event or circumstance indicates that it is more likely than not that an impairment loss has been incurred. The fair value of our reporting units and trade names are considered Level 3 measurements. Level 3 measurements require significant unobservable inputs that are reflected in our assumptions. See "Note 8 . Goodwill and Identifiable Intangible Assets" for more information on those assumptions. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | 14 . Accumulated Other Comprehensive Income (Loss) AOCI is defined as net income (loss) and other changes in stockholders’ equity from transactions and other events from sources other than stockholders. The components of, and changes in, AOCI were as follows: (in millions) Derivative Financial Instruments Foreign Currency Adjustments Unrecognized Pension and Other Post-retirement Benefit Costs Accumulated Other Comprehensive Income (Loss) Balance at December 31, 2022 $ 1.1 $ ( 380.1 ) $ ( 161.3 ) $ ( 540.3 ) Other comprehensive income (loss) before reclassifications, net of tax ( 0.5 ) 8.9 ( 2.6 ) 5.8 Amounts reclassified from accumulated other comprehensive income (loss), net of tax ( 0.4 ) — 1.1 0.7 Balance at March 31, 2023 $ 0.2 $ ( 371.2 ) $ ( 162.8 ) $ ( 533.8 ) The reclassifications out of AOCI for the three months ended March 31, 2023 and 2022 were as follows: (in millions) 2023 2022 Details about Accumulated Other Comprehensive Income (Loss) Components Amount Reclassified from Accumulated Other Comprehensive Income (Loss) Location on Income Statement Gain (loss) on cash flow hedges: Foreign exchange contracts $ 0.5 $ 2.4 Cost of products sold Tax expense ( 0.1 ) ( 0.7 ) Income tax expense Net of tax $ 0.4 $ 1.7 Defined benefit plan items: Amortization of actuarial loss $ ( 1.5 ) $ ( 2.2 ) (1) Amortization of prior service cost ( 0.1 ) — (1) Total before tax ( 1.6 ) ( 2.2 ) Tax benefit 0.5 0.5 Income tax expense Net of tax $ ( 1.1 ) $ ( 1.7 ) Total reclassifications for the period, net of tax $ ( 0.7 ) $ — (1) These AOCI components are included in the computation of net periodic benefit (income) cost for pension and post-retirement plans. See "Note 5 . Pension and Other Retiree Benefits" for additional details. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | 15 . Revenue Recognition Revenue is recognized when control of the promised goods or services is transferred to our customers in an amount reflective of the consideration we expect to receive in exchange for those goods or services. Taxes we collect concurrent with revenue producing activities are excluded from revenue. Incidental items incurred that are immaterial in the context of the contract are expensed. At the inception of each contract, the Company assesses the products and services promised and identifies each distinct performance obligation. To identify the performance obligations, the Company considers all products and services promised regardless of whether they are explicitly stated or implied within the contract or by standard business practices. Freight and distribution activities performed before the customer obtains control of the goods are not considered promised services under customer contracts and therefore are not distinct performance obligations. The Company has chosen to account for shipping and handling activities as a fulfillment activity, and therefore accrues the expense of freight and distribution in "Cost of products sold" when products are shipped. Service or Extended Maintenance Agreements ("EMAs"). As of December 31, 2022, there was $ 2.8 million of unearned revenue associated with outstanding EMAs, primarily reported in "Other current liabilities." During the three months ended March 31, 2023 , $ 1.2 million of the unearned revenue was earned and recognized. As of March 31, 2023 , the amount of unearned revenue from EMAs was $ 2.8 million. We expect to earn and recognize approximately $ 2.4 million of the unearned amount in the next 12 months and $ 0.4 million in periods beyond the next 12 months. The following tables present our net sales disaggregated by regional geography (1) , by reporting business segments and our net sales disaggregated by the timing of revenue recognition for the three months ended March 31, 2023 and 2022: Three Months Ended March 31, (in millions) 2023 2022 United States $ 155.1 $ 188.5 Canada 21.6 20.0 ACCO Brands North America 176.7 208.5 ACCO Brands EMEA (2) 135.8 156.1 Australia/N.Z. 28.3 30.0 Latin America 52.4 34.4 Asia-Pacific 9.4 12.6 ACCO Brands International 90.1 77.0 Net sales $ 402.6 $ 441.6 (1) Net sales are attributed to geographic areas based on the location of the selling subsidiaries. (2) ACCO Brands EMEA is comprised largely of Europe, but also includes export sales to the Middle East and Africa. Three Months Ended March 31, (in millions) 2023 2022 Product and services transferred at a point in time $ 390.3 $ 429.3 Product and services transferred over time 12.3 12.3 Net sales $ 402.6 $ 441.6 |
Information on Business Segment
Information on Business Segments | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Information on Business Segments | 16 . Information on Business Segments The Company has three operating business segments, each of which is comprised of different geographic regions. The Company's three segments are as follows: Operating Segment Geography Primary Brands Primary Products ACCO Brands North America United States and Canada PowerA ® , Five Star ® , AT-A-GLANCE ® , Quartet ® , Kensington ® , Swingline ® , GBC ® , Mead ® , Hilroy ® Computer and gaming accessories, school products, planners, storage and organization, dry erase boards and accessories, laminating, stapling and punching products. ACCO Brands EMEA Europe, Middle East and Africa Leitz ® , Rapid ® , Kensington ® , Esselte ® , Rexel ® , PowerA ® , GBC ® , NOBO ® , Derwent ® Storage and organization products (lever-arch binders, sheet protectors, indexes), computer and gaming accessories, stapling, punching, shredding, laminating, do-it-yourself tools, dry erase boards and writing and art products. ACCO Brands International Australia/N.Z., Latin America and Asia-Pacific Tilibra ® , GBC ® , Kensington ® , Marbig ® , Foroni ® , Barrilito ® , Artline ® *, PowerA ® , Spirax ® *Australia/N.Z. only School notebooks, storage and organization products (binders, sheet protectors and indexes), computer and gaming accessories, laminating, shredding, writing and arts products, janitorial supplies, dry erase boards, and stapling and punching products. Customers We distribute our products through a wide variety of channels to ensure that our products are readily and conveniently available for purchase by consumers and other end-users, wherever they prefer to shop. These channels include mass retailers, e-tailers, technology distributors, discount, drug/grocery and variety chains, warehouse clubs, hardware and specialty stores, independent office product dealers, office superstores, wholesalers, contract stationers. We also sell directly through e-commerce sites and our direct sales organization. Net sales by reportable business segment for the three months ended March 31, 2023 and 2022 were as follows: (in millions) 2023 2022 ACCO Brands North America $ 176.7 $ 208.5 ACCO Brands EMEA 135.8 156.1 ACCO Brands International 90.1 77.0 Net sales $ 402.6 $ 441.6 Operating income by business segment for the three months ended March 31, 2023 and 2022 was as follows: (in millions) 2023 2022 ACCO Brands North America $ 5.2 $ 13.9 ACCO Brands EMEA 7.8 5.6 ACCO Brands International 9.0 4.2 Segment operating income 22.0 23.7 Change in fair value of contingent consideration — ( 2.6 ) Corporate ( 11.9 ) ( 14.3 ) Operating income (1) 10.1 6.8 Interest expense 13.9 9.7 Interest income ( 2.4 ) ( 1.4 ) Non-operating pension expense (income) 0.1 ( 1.4 ) Other expense, net 1.8 0.9 Loss before income tax $ ( 3.3 ) $ ( 1.0 ) (1) Operating income is defined as i) net sales; ii) less cost of products sold; iii) less selling, general and administrative expenses; iv) less amortization of intangibles; v) less restructuring charges; and vi) less change in the fair value of contingent consideration. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 17 . Commitments and Contingencies Pending Litigation - Brazil Tax Assessments In connection with our May 1, 2012, acquisition of the Mead C&OP business, we assumed all of the tax liabilities for the acquired foreign operations including ACCO Brazil. For further information, see "Note 10. Income Taxes - Brazil Tax Assessments " for details on tax assessments issued by the FRD against ACCO Brazil challenging the tax deduction of goodwill from ACCO Brazil's taxable income for the years 2007 through 2010. If the FRD's initial position is ultimately sustained, payment of the amount assessed would materially and adversely affect our cash flow in the year of settlement. Brazil Tax Credits In May 2021, the Supreme Court of Brazil issued its final ruling in a leading case related to the computation of certain indirect taxes which provides that the indirect tax base should not include the gross amount of the value-added tax known as “ICMS.” The Supreme Court further ruled that taxpayers can recognize future operating credits ("Tax Credits") for excess indirect tax payments from past periods due to the inclusion of ICMS in the indirect tax base to the extent the taxpayer had filed judicial challenges seeking to recover excess tax payments prior to March 15, 2017 and for any excess tax payments made after March 15, 2017. ACCO Brazil filed legal actions requesting recovery of these excess tax payments by way of future Tax Credits covering various time periods prior to March 15, 2017. Some of these cases have been finally decided in a court of law in favor of ACCO Brazil, while others are still pending. Finalization of the remaining legal actions ACCO Brazil has filed will result in additional Tax Credits of approximately $ 3.0 million. The Tax Credits will be utilized against future tax obligations. Indústria Gráfica Foroni Ltda. ("Foroni"), in years prior to its acquisition by ACCO Brazil, also filed a legal action in Brazil to recover these excess indirect tax payments and this legal action has been finalized. We are required under the quota purchase agreement to remit any recovered tax credits, less the applicable tax, to the former owners of Foroni to the extent they relate to a tax period prior to the acquisition date. Other Pending Litigation We are party to various lawsuits and regulatory proceedings, primarily related to alleged patent infringement, as well as other claims incidental to our business. In addition, we may be unaware of third-party claims of intellectual property infringement relating to our technology, brands, or products, and we may face other claims related to business operations. Any litigation regarding patents or other intellectual property could be costly and time-consuming and might require us to pay monetary damages or enter into costly license agreements. We also may be subject to injunctions against development and sale of certain of our products. It is the opinion of management that (other than the Brazil Tax Assessments) the ultimate resolution of currently outstanding matters will not have a material adverse effect on our financial condition, results of operations or cash flow. However, there is no assurance that we will ultimately be successful in our defense of any of these matters or that an adverse outcome in any matter will not affect our results of operations, financial condition or cash flow. Further, future claims, lawsuits and legal proceedings could materially and adversely affect our business, reputation, results of operations and financial condition. |
Recent Accounting Pronounceme_2
Recent Accounting Pronouncements and Adopted Accounting Standards (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements There are no recently issued accounting pronouncements that are expected to have an impact on the Company’s financial condition, results of operations or cash flow. Recently Adopted Accounting Standards In March 2020, the Financial Accounting Standards Board ("FASB") issued ASU 2020-04, Reference Rate Reform (Topic 848), which provides optional expedients and exceptions for applying current GAAP to contracts, hedging relationships, and other transactions affected by the transition from the use of LIBOR to an alternative reference rate. Effective in the fourth quarter of 2022, the Company adopted this standard. The adoption of this standard did not have a material impact on our consolidated financial statements. There were no accounting standards that were adopted in the first three months of 2023 that had a material effect on the Company’s financial condition, results of operations or cash flow. |
Leases | The Company determines if an arrangement is a lease at inception. Leases are included in "Right of use asset, leases" ("ROU Assets"), and the current portion of the lease liability is included in "Lease liabilities" and the non-current portion is included in "Long-term lease liabilities" in the Condensed Consolidated Balance Sheets. The Company currently has an immaterial amount of financing leases and leases with terms of more than one month and less than 12 months. ROU Assets and Lease liabilities are recognized based on the present value of lease payments over the lease term. Because most of the Company’s leases do not provide an implicit rate of return, the Company uses its incremental collateralized borrowing rate, on a regional basis, in determining the present value of lease payments. The incremental borrowing rate is dependent upon the duration of the lease and has been segmented into three groups of time. All leases within the same region and the same group of time share the same incremental borrowing rate. The Company has lease agreements with lease and non-lease components, which are combined for accounting purposes for all classes of underlying assets except information technology equipment. |
Long-term Debt and Short-term_2
Long-term Debt and Short-term Borrowings (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Summary of Notes Payable and Long-Term Debt | Notes payable and long-term debt, listed in order of the priority of security interests in assets of the Company, consisted of the following as of March 31, 2023 and December 31, 2022: (in millions) March 31, December 31, Euro Senior Secured Term Loan A, due March 2026 (floating interest rate of 5.27 % at March 31, 2023 and 3.90 % at December 31, 2022) $ 229.4 $ 227.4 USD Senior Secured Term Loan A, due March 2026 (floating interest rate of 7.18 % at March 31, 2023 and 6.40 % at December 31, 2022) 83.3 84.4 Australian Dollar Senior Secured Term Loan A, due March 2026 (floating interest rate of 6.00 % at March 31, 2023 and 5.30 % at December 31, 2022) 34.1 34.9 U.S. Dollar Senior Secured Revolving Credit Facility, due March 2026 (floating interest rate of 7.17 % at March 31, 2023 and 6.36 % at December 31, 2022) 148.4 58.6 Australian Dollar Senior Secured Revolving Credit Facility, due March 2026 (floating interest rate of 5.84 % at March 31, 2023 and 5.18 % at December 31, 2022) 20.1 14.2 Senior Unsecured Notes, due March 2029 (fixed interest rate of 4.25 %) 575.0 575.0 Other borrowings 9.1 10.4 Total debt 1,099.4 1,004.9 Less: Current portion 56.4 60.0 Debt issuance costs, unamortized 8.0 8.4 Long-term debt, net $ 1,035.0 $ 936.5 |
Schedule of Maximum Consolidated Leverage Ratio | the maximum Consolidated Leverage Ratio (as defined in the Credit Agreement) financial covenant for each of the five fiscal quarters beginning December 31, 2022, and ending December 31, 2023, as follows: Quarter Ended Maximum Consolidated Leverage Ratio December 2022 4.50 :1.00 March 2023 5.00 :1.00 June 2023 5.00 :1.00 September 2023 4.75 :1.00 December 2023 4.25 :1.00 |
Schedule of Applicable Rate and Undrawn Fee Based on Company's Consolidated Leverage Ratio | The current maturity of the Credit Agreement is March 31, 2026 and the current pricing is as follows: Consolidated Leverage Ratio Applicable Rate on Euro/AUD/CDN Dollar Loans Applicable Rate on Base Rate Loans Undrawn Fee > 4.50 to 1.00 2.50 % 1.50 % 0.500 % ≤ 4.50 to 1.00 and > 4.00 to 1.00 2.25 % 1.25 % 0.375 % ≤ 4.00 to 1.00 and > 3.50 to 1.00 2.00 % 1.00 % 0.350 % ≤ 3.50 to 1.00 and > 3.00 to 1.00 1.75 % 0.75 % 0.300 % ≤ 3.00 to 1.00 and > 2.00 to 1.00 1.50 % 0.50 % 0.250 % ≤ 2.00 to 1.00 1.25 % 0.25 % 0.200 % |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Components of Lease Expense and Other Information | The components of lease expense were as follows: Three Months Ended (in millions) 2023 2022 Operating lease cost $ 7.0 $ 7.7 Sublease income ( 0.6 ) ( 0.6 ) Total lease cost $ 6.4 $ 7.1 Other information related to leases was as follows: Three Months Ended (in millions, except lease term and discount rate) 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 7.4 $ 8.5 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 3.4 $ 5.2 Weighted average remaining lease term: Operating leases 6.1 years Weighted average discount rate: Operating leases 4.6 % |
Schedule of Future Minimum Lease Payments, Net of Sublease Income | Future minimum lease payments, net of sublease income, for all non-cancelable leases as of March 31, 2023, were as follows: (in millions) Operating 2023 $ 19.2 2024 20.9 2025 17.6 2026 13.9 2027 9.4 2028 8.9 Thereafter 20.4 Total minimum lease payments 110.3 Less imputed interest 15.4 Future minimum payments for leases, net of sublease rental income and imputed interest $ 94.9 |
Pension and Other Retiree Ben_2
Pension and Other Retiree Benefits (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Retirement Benefits [Abstract] | |
Components of Net Periodic Benefit Cost for Pension and Post-Retirement Plans | The components of net periodic benefit (income) cost for pension and post-retirement plans for the three months ended March 31, 2023 and 2022 were as follows: Three Months Ended March 31, Pension Post-retirement U.S. International (in millions) 2023 2022 2023 2022 2023 2022 Service cost $ — $ — $ 0.1 $ 0.3 $ — $ — Interest cost 2.0 1.2 4.9 2.5 — — Expected return on plan assets ( 3.0 ) ( 2.7 ) ( 5.3 ) ( 4.6 ) — — Amortization of net loss (gain) 0.6 0.9 1.0 1.4 ( 0.1 ) ( 0.1 ) Amortization of prior service cost — — 0.1 — — — Net periodic benefit (income) cost (1) $ ( 0.4 ) $ ( 0.6 ) $ 0.8 $ ( 0.4 ) $ ( 0.1 ) $ ( 0.1 ) (1) The components of net periodic benefit (income) cost, other than service cost, are included in the line "Non-operating pension expense (income)" in the Consolidated Statements of Loss. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan | The following table summarizes our stock-based compensation expense (including stock options, restricted stock units ("RSUs") and performance stock units ("PSUs")) for the three months ended March 31, 2023 and 2022: Three months ended (in millions) 2023 2022 Stock option compensation expense $ 1.9 $ 2.1 RSU compensation expense 2.3 2.1 PSU compensation expense 1.4 0.7 Total stock-based compensation expense $ 5.6 $ 4.9 |
Schedule of Unrecognized Compensation Cost, Nonvested Awards | The following table summarizes our unrecognized compensation expense and the weighted-average period over which the expense will be recognized as of March 31, 2023: March 31, 2023 (in millions, except weighted average years) Unrecognized Compensation Expense Weighted Average Years Expense To Be Recognized Over Stock options $ 1.7 1.7 RSUs $ 4.9 2.7 PSUs $ 10.2 2.3 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Components of Inventories | The components of inventories were as follows: (in millions) March 31, 2023 December 31, 2022 Raw materials $ 90.3 $ 76.8 Work in process 4.6 4.4 Finished goods 327.6 314.0 Total inventories $ 422.5 $ 395.2 |
Goodwill and Identifiable Int_2
Goodwill and Identifiable Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in Net Carrying Amount of Goodwill by Segment | Changes in the net carrying amount of goodwill by segment were as follows: (in millions) ACCO Brands North America ACCO Brands EMEA ACCO Brands International Total Balance at December 31, 2022 $ 348.0 $ 145.6 $ 177.9 $ 671.5 Foreign currency translation — ( 0.2 ) 0.6 0.4 Balance at March 31, 2023 $ 348.0 $ 145.4 $ 178.5 $ 671.9 |
Gross Carrying Value and Accumulated Amortization by Class of Identifiable Intangible Assets | The gross carrying value and accumulated amortization by class of identifiable intangible assets as of March 31, 2023 and December 31, 2022, were as follows: March 31, 2023 December 31, 2022 (in millions) Gross Carrying Amounts Accumulated Amortization Net Book Value Gross Carrying Amounts Accumulated Amortization Net Book Value Indefinite-lived intangible assets: Trade names (1) $ 295.1 $ ( 44.5 ) $ 250.6 $ 410.6 $ ( 44.5 ) $ 366.1 Amortizable intangible assets: Trade names 491.0 ( 127.9 ) 363.1 369.7 ( 123.0 ) 246.7 Customer and contractual relationships 359.5 ( 204.7 ) 154.8 356.9 ( 198.2 ) 158.7 Vendor relationships 82.4 ( 12.6 ) 69.8 82.4 ( 11.2 ) 71.2 Patents 8.2 ( 4.1 ) 4.1 8.1 ( 3.8 ) 4.3 Subtotal 941.1 ( 349.3 ) 591.8 817.1 ( 336.2 ) 480.9 Total identifiable intangibles $ 1,236.2 $ ( 393.8 ) $ 842.4 $ 1,227.7 $ ( 380.7 ) $ 847.0 (1) Accumulated amortization prior to the adoption of authoritative guidance on goodwill and other intangible assets, at which time further amortization ceased. |
Estimated Amortization Expense for Future Periods | Estimated amortization expense for amortizable intangible assets, as of March 31, 2023, for the current year and the next five years is as follows: (in millions) 2023 2024 2025 2026 2027 2028 Estimated amortization expense (2) $ 43.6 $ 42.0 $ 40.4 $ 38.3 $ 35.9 $ 33.7 (2) Actual amounts of amortization expense may differ from estimated amounts due to changes in foreign currency exchange rates, additional intangible asset acquisitions, impairment of intangible assets, accelerated amortization of intangible assets and other events. |
Restructuring (Tables)
Restructuring (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Restructuring and Related Activities [Abstract] | |
Summary of Activity in Restructuring Accounts | The summary of the activity in the restructuring liability for the three months ended March 31, 2023, was as follows: Balance at Non-cash Items / Balance at (in millions) December 31, Provision Cash Currency March 31, Employee termination costs (1) $ 8.7 $ 2.7 $ ( 2.6 ) $ 0.1 $ 8.9 Other (2) — 0.6 — — 0.6 Total restructuring liability $ 8.7 $ 3.3 $ ( 2.6 ) $ 0.1 $ 9.5 (1) We expect the remaining $ 8.9 million employee termination costs to be substantially paid in the next twelve months . (2) We expect the remaining $ 0.6 million of other costs to be substantially paid in the next twelve months . The summary of the activity in the restructuring liability for the three months ended March 31, 2022, was as follows: Balance at Non-cash Items / Balance at (in millions) December 31, Provision Cash Currency March 31, Employee termination costs $ 3.4 $ 0.3 $ ( 1.0 ) $ — $ 2.7 Termination of lease agreements 1.1 — ( 0.6 ) — 0.5 Total restructuring liability $ 4.5 $ 0.3 $ ( 1.6 ) $ — $ 3.2 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Summary of Number of Weighted-Average Shares Outstanding | The number of our weighted-average shares outstanding for the three months ended March 31, 2023 and 2022 was as follows: Three Months Ended March 31, (in millions) 2023 2022 Weighted-average number of shares of common stock outstanding - basic 94.9 96.2 Stock options — — Restricted stock units — — Weighted-average shares and assumed conversions - diluted (1) 94.9 96.2 (1) Due to the net loss during the three months ended March 31, 2023, the denominator in the diluted earnings per share calculation does not include the effects of the stock awards for which the average market price for the period exceeds the exercise price, as it would result in a less dilutive computation. As a result, reporting diluted earnings per share for the three months ended March 31, 2023 are the same as basic earnings per share. |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The following table summarizes the fair value of our derivative financial instruments as of March 31, 2023 and December 31, 2022: Fair Value of Derivative Instruments Derivative Assets Derivative Liabilities (in millions) Balance Sheet Location March 31, December 31, Balance Sheet Location March 31, December 31, Derivatives designated as hedging instruments: Foreign exchange contracts Other current assets $ 1.7 $ 3.6 Other current liabilities $ 1.1 $ 1.9 Derivatives not designated as hedging instruments: Foreign exchange contracts Other current assets 0.4 0.7 Other current liabilities 0.6 0.7 Foreign exchange contracts Other non-current assets 0.2 4.9 Other non-current liabilities 0.2 4.9 Total derivatives $ 2.3 $ 9.2 $ 1.9 $ 7.5 |
Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance | The following tables summarize the pre-tax effect of our derivative financial instruments on the condensed consolidated financial statements for the three months ended March 31, 2023 and 2022: The Effect of Derivative Instruments in Cash Flow Hedging Relationships on the Consolidated Financial Statements Amount of Gain (Loss) Recognized in AOCI (Effective Portion) Location of (Gain) Loss Reclassified from AOCI to Income Amount of (Gain) Loss Reclassified from AOCI to Income (Effective Portion) Three Months Ended March 31, Three Months Ended March 31, (in millions) 2023 2022 2023 2022 Cash flow hedges: Foreign exchange contracts $ ( 0.6 ) $ ( 0.2 ) Cost of products sold $ ( 0.5 ) $ ( 2.4 ) The Effect of Derivatives Not Designated as Hedging Instruments on the Consolidated Statements of (Loss) Income Location of (Gain) Loss Recognized in Income on Derivatives Amount of (Gain) Loss Recognized in Income Three Months Ended (in millions) 2023 2022 Foreign exchange contracts Other expense, net $ 1.7 $ ( 0.6 ) |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Assets and Liabilities Measured on a Recurring Basis | The following table sets forth our financial assets and liabilities that were accounted for at fair value on a recurring basis as of March 31, 2023 and December 31, 2022: (in millions) March 31, December 31, Assets: Forward currency contracts $ 2.3 $ 9.2 Liabilities: Forward currency contracts $ 1.9 $ 7.5 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The components of, and changes in, AOCI were as follows: (in millions) Derivative Financial Instruments Foreign Currency Adjustments Unrecognized Pension and Other Post-retirement Benefit Costs Accumulated Other Comprehensive Income (Loss) Balance at December 31, 2022 $ 1.1 $ ( 380.1 ) $ ( 161.3 ) $ ( 540.3 ) Other comprehensive income (loss) before reclassifications, net of tax ( 0.5 ) 8.9 ( 2.6 ) 5.8 Amounts reclassified from accumulated other comprehensive income (loss), net of tax ( 0.4 ) — 1.1 0.7 Balance at March 31, 2023 $ 0.2 $ ( 371.2 ) $ ( 162.8 ) $ ( 533.8 ) |
Schedule of Reclassifications Out of Accumulated Other Comprehensive Income (Loss) | The reclassifications out of AOCI for the three months ended March 31, 2023 and 2022 were as follows: (in millions) 2023 2022 Details about Accumulated Other Comprehensive Income (Loss) Components Amount Reclassified from Accumulated Other Comprehensive Income (Loss) Location on Income Statement Gain (loss) on cash flow hedges: Foreign exchange contracts $ 0.5 $ 2.4 Cost of products sold Tax expense ( 0.1 ) ( 0.7 ) Income tax expense Net of tax $ 0.4 $ 1.7 Defined benefit plan items: Amortization of actuarial loss $ ( 1.5 ) $ ( 2.2 ) (1) Amortization of prior service cost ( 0.1 ) — (1) Total before tax ( 1.6 ) ( 2.2 ) Tax benefit 0.5 0.5 Income tax expense Net of tax $ ( 1.1 ) $ ( 1.7 ) Total reclassifications for the period, net of tax $ ( 0.7 ) $ — (1) These AOCI components are included in the computation of net periodic benefit (income) cost for pension and post-retirement plans. See "Note 5 . Pension and Other Retiree Benefits" for additional details. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following tables present our net sales disaggregated by regional geography (1) , by reporting business segments and our net sales disaggregated by the timing of revenue recognition for the three months ended March 31, 2023 and 2022: Three Months Ended March 31, (in millions) 2023 2022 United States $ 155.1 $ 188.5 Canada 21.6 20.0 ACCO Brands North America 176.7 208.5 ACCO Brands EMEA (2) 135.8 156.1 Australia/N.Z. 28.3 30.0 Latin America 52.4 34.4 Asia-Pacific 9.4 12.6 ACCO Brands International 90.1 77.0 Net sales $ 402.6 $ 441.6 (1) Net sales are attributed to geographic areas based on the location of the selling subsidiaries. (2) ACCO Brands EMEA is comprised largely of Europe, but also includes export sales to the Middle East and Africa. Three Months Ended March 31, (in millions) 2023 2022 Product and services transferred at a point in time $ 390.3 $ 429.3 Product and services transferred over time 12.3 12.3 Net sales $ 402.6 $ 441.6 |
Information on Business Segme_2
Information on Business Segments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Net Sales by Business Segment | Net sales by reportable business segment for the three months ended March 31, 2023 and 2022 were as follows: (in millions) 2023 2022 ACCO Brands North America $ 176.7 $ 208.5 ACCO Brands EMEA 135.8 156.1 ACCO Brands International 90.1 77.0 Net sales $ 402.6 $ 441.6 |
Schedule of Operating Income by Business Segment | Operating income by business segment for the three months ended March 31, 2023 and 2022 was as follows: (in millions) 2023 2022 ACCO Brands North America $ 5.2 $ 13.9 ACCO Brands EMEA 7.8 5.6 ACCO Brands International 9.0 4.2 Segment operating income 22.0 23.7 Change in fair value of contingent consideration — ( 2.6 ) Corporate ( 11.9 ) ( 14.3 ) Operating income (1) 10.1 6.8 Interest expense 13.9 9.7 Interest income ( 2.4 ) ( 1.4 ) Non-operating pension expense (income) 0.1 ( 1.4 ) Other expense, net 1.8 0.9 Loss before income tax $ ( 3.3 ) $ ( 1.0 ) (1) Operating income is defined as i) net sales; ii) less cost of products sold; iii) less selling, general and administrative expenses; iv) less amortization of intangibles; v) less restructuring charges; and vi) less change in the fair value of contingent consideration. |
Long-term Debt and Short-term_3
Long-term Debt and Short-term Borrowings - Summary of Notes Payable and Long-Term Debt (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Total debt | $ 1,099.4 | $ 1,004.9 |
Current portion | 56.4 | 60 |
Debt issuance costs, unamortized | 8 | 8.4 |
Long-term debt, net | 1,035 | 936.5 |
Euro Senior Secured Term Loan A, due March 2026 (floating interest rate of 2.69% at September 30, 2022 and 2.00% December 31, 2021) | ||
Debt Instrument [Line Items] | ||
Total debt | 229.4 | 227.4 |
USD Senior Secured Term Loan A, due March 2026 (floating interest rate of 5.12% at September 30, 2022 and 2.22% at December 31, 2021) | ||
Debt Instrument [Line Items] | ||
Total debt | 83.3 | 84.4 |
Australian Dollar Senior Secured Term Loan A, due March 2026 (floating interest rate of 5.07% at September 30, 2022 and 2.11% at December 31, 2021) | ||
Debt Instrument [Line Items] | ||
Total debt | 34.1 | 34.9 |
U.S. Dollar Senior Secured Revolving Credit Facility, due March 2026 (floating interest rate of 4.92% at September 30, 2022 and 2.10% at December 31, 2021) | ||
Debt Instrument [Line Items] | ||
Total debt | 148.4 | 58.6 |
Australian Dollar Senior Secured Revolving Credit Facility, due March 2026 (floating interest rate of 4.90% at September 30, 2022 and 2.06% at December 31, 2021) | ||
Debt Instrument [Line Items] | ||
Total debt | 20.1 | 14.2 |
Senior Unsecured Notes, due March 2029 (fixed interest rate of 4.25%) | ||
Debt Instrument [Line Items] | ||
Total debt | 575 | 575 |
Other borrowings | ||
Debt Instrument [Line Items] | ||
Total debt | $ 9.1 | $ 10.4 |
Long-term Debt and Short-term_4
Long-term Debt and Short-term Borrowings - Summary of Notes Payable and Long-Term Debt (Parenthetical) (Details) | Mar. 31, 2023 | Dec. 31, 2022 |
Senior Secured Notes | Euro Senior Secured Term Loan A, due March 2026 (floating interest rate of 2.69% at September 30, 2022 and 2.00% December 31, 2021) | ||
Debt Instrument [Line Items] | ||
Floating interest rate (percent) | 5.27% | 3.90% |
Senior Secured Notes | USD Senior Secured Term Loan A, due March 2026 (floating interest rate of 5.12% at September 30, 2022 and 2.22% at December 31, 2021) | ||
Debt Instrument [Line Items] | ||
Floating interest rate (percent) | 7.18% | 6.40% |
Senior Secured Notes | Australian Dollar Senior Secured Term Loan A, due March 2026 (floating interest rate of 5.07% at September 30, 2022 and 2.11% at December 31, 2021) | ||
Debt Instrument [Line Items] | ||
Floating interest rate (percent) | 6% | 5.30% |
Senior Secured Notes | U.S. Dollar Senior Secured Revolving Credit Facility, due March 2026 (floating interest rate of 4.92% at September 30, 2022 and 2.10% at December 31, 2021) | ||
Debt Instrument [Line Items] | ||
Floating interest rate (percent) | 7.17% | 6.36% |
Senior Secured Notes | Australian Dollar Senior Secured Revolving Credit Facility, due March 2026 (floating interest rate of 4.90% at September 30, 2022 and 2.06% at December 31, 2021) | ||
Debt Instrument [Line Items] | ||
Floating interest rate (percent) | 5.84% | 5.18% |
Senior Notes | Senior Unsecured Notes, due March 2029 (fixed interest rate of 4.25%) | ||
Debt Instrument [Line Items] | ||
Stated interest rate (percent) | 4.25% | 4.25% |
Long-term Debt and Short-term_5
Long-term Debt and Short-term Borrowings - Narrative (Details) € in Millions, $ in Millions, $ in Millions | Mar. 31, 2023 USD ($) | Jan. 27, 2017 USD ($) | Dec. 31, 2022 USD ($) | Mar. 15, 2021 USD ($) | May 23, 2019 | May 22, 2019 | Jan. 27, 2017 EUR (€) | Jan. 27, 2017 AUD ($) |
Debt Instrument [Line Items] | ||||||||
Total debt | $ 1,099.4 | $ 1,004.9 | ||||||
Maximum consolidated leverage ratio | 5 | |||||||
Senior Secured Credit Facility Due January 2022 | ||||||||
Debt Instrument [Line Items] | ||||||||
Credit agreement, term | 5 years | |||||||
Senior Unsecured Notes, due March 2029 (fixed interest rate of 4.25%) | ||||||||
Debt Instrument [Line Items] | ||||||||
Total debt | $ 575 | $ 575 | ||||||
Senior Secured Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Credit agreement, face amount | $ 320.8 | € 300 | ||||||
Maximum borrowing capacity | 100 | |||||||
Senior Secured Notes | Senior Secured Credit Facility Due January 2022 | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Fixed coverage ratio | 1.25 | |||||||
Senior Secured Notes | AUD Term Loan A | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | 60.4 | $ 80 | ||||||
Senior Secured Notes | Senior Secured Credit Facility Due March 2026 | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum consolidated leverage ratio | 5 | |||||||
Consolidated leverage ratio | 4.30 | |||||||
Senior Secured Notes | Senior Secured Credit Facility Due May 2024 | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest coverage ratio | 3 | |||||||
Senior Notes | Senior Unsecured Notes, due March 2029 (fixed interest rate of 4.25%) | ||||||||
Debt Instrument [Line Items] | ||||||||
Credit agreement, face amount | $ 575 | |||||||
Stated percentage | 4.25% | 4.25% | ||||||
Revolving Facility | Senior Secured Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | $ 600 | |||||||
Revolving Facility | Senior Secured Notes | Senior Secured Credit Facility Due March 2026 | ||||||||
Debt Instrument [Line Items] | ||||||||
Credit agreement, maturity date | Mar. 31, 2026 | |||||||
Total debt | $ 168.5 | |||||||
Amount available for borrowings under Senior Secured Revolving Credit Facilities | 419.6 | |||||||
Letters of credit outstanding | $ 11.9 |
Long-term Debt and Short-term_6
Long-term Debt and Short-term Borrowings - Schedule of Maximum Consolidated Leverage Ratio (Details) | Mar. 31, 2023 |
Line of Credit Facility [Line Items] | |
Maximum consolidated leverage ratio | 5 |
December 2022 | Senior Secured Credit Facility Due May 2024 | Secured Debt | |
Line of Credit Facility [Line Items] | |
Maximum consolidated leverage ratio | 4.50 |
March 2023 | Senior Secured Credit Facility Due May 2024 | Secured Debt | |
Line of Credit Facility [Line Items] | |
Maximum consolidated leverage ratio | 5 |
June 2023 | Senior Secured Credit Facility Due May 2024 | Secured Debt | |
Line of Credit Facility [Line Items] | |
Maximum consolidated leverage ratio | 5 |
September 2023 | Senior Secured Credit Facility Due May 2024 | Secured Debt | |
Line of Credit Facility [Line Items] | |
Maximum consolidated leverage ratio | 4.75 |
December 2023 | Senior Secured Credit Facility Due May 2024 | Secured Debt | |
Line of Credit Facility [Line Items] | |
Maximum consolidated leverage ratio | 4.25 |
Long-term Debt and Short-term_7
Long-term Debt and Short-term Borrowings - Schedule of Applicable Rate and Undrawn Fee Based on Company's Consolidated Leverage Ratio (Details) - Secured Debt - Senior Secured Credit Facility Due March 2026 | 3 Months Ended |
Mar. 31, 2023 | |
> 4.50 to 1.00 | |
Debt Instrument [Line Items] | |
Undrawn fee | 50% |
> 4.50 to 1.00 | Applicable Rate on Euro/AUD/CDN Dollar Loans | |
Debt Instrument [Line Items] | |
Basis spread on variable rate (percent) | 250% |
> 4.50 to 1.00 | Applicable Rate on Base Rate Loans | |
Debt Instrument [Line Items] | |
Basis spread on variable rate (percent) | 150% |
≤ 4.50 to 1.00 and > 4.00 to 1.00 | |
Debt Instrument [Line Items] | |
Undrawn fee | 37.50% |
≤ 4.50 to 1.00 and > 4.00 to 1.00 | Applicable Rate on Euro/AUD/CDN Dollar Loans | |
Debt Instrument [Line Items] | |
Basis spread on variable rate (percent) | 225% |
≤ 4.50 to 1.00 and > 4.00 to 1.00 | Applicable Rate on Base Rate Loans | |
Debt Instrument [Line Items] | |
Basis spread on variable rate (percent) | 125% |
≤ 4.00 to 1.00 and > 3.50 to 1.00 | |
Debt Instrument [Line Items] | |
Undrawn fee | 35% |
≤ 4.00 to 1.00 and > 3.50 to 1.00 | Applicable Rate on Euro/AUD/CDN Dollar Loans | |
Debt Instrument [Line Items] | |
Basis spread on variable rate (percent) | 200% |
≤ 4.00 to 1.00 and > 3.50 to 1.00 | Applicable Rate on Base Rate Loans | |
Debt Instrument [Line Items] | |
Basis spread on variable rate (percent) | 100% |
≤ 3.50 to 1.00 and > 3.00 to 1.00 | |
Debt Instrument [Line Items] | |
Undrawn fee | 30% |
≤ 3.50 to 1.00 and > 3.00 to 1.00 | Applicable Rate on Euro/AUD/CDN Dollar Loans | |
Debt Instrument [Line Items] | |
Basis spread on variable rate (percent) | 175% |
≤ 3.50 to 1.00 and > 3.00 to 1.00 | Applicable Rate on Base Rate Loans | |
Debt Instrument [Line Items] | |
Basis spread on variable rate (percent) | 75% |
≤ 3.00 to 1.00 and > 2.00 to 1.00 | |
Debt Instrument [Line Items] | |
Undrawn fee | 25% |
≤ 3.00 to 1.00 and > 2.00 to 1.00 | Applicable Rate on Euro/AUD/CDN Dollar Loans | |
Debt Instrument [Line Items] | |
Basis spread on variable rate (percent) | 150% |
≤ 3.00 to 1.00 and > 2.00 to 1.00 | Applicable Rate on Base Rate Loans | |
Debt Instrument [Line Items] | |
Basis spread on variable rate (percent) | 50% |
≤ 2.00 to 1.00 | |
Debt Instrument [Line Items] | |
Undrawn fee | 20% |
≤ 2.00 to 1.00 | Applicable Rate on Euro/AUD/CDN Dollar Loans | |
Debt Instrument [Line Items] | |
Basis spread on variable rate (percent) | 125% |
≤ 2.00 to 1.00 | Applicable Rate on Base Rate Loans | |
Debt Instrument [Line Items] | |
Basis spread on variable rate (percent) | 25% |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Leases [Abstract] | ||
Operating lease cost | $ 7 | $ 7.7 |
Sublease income | (0.6) | (0.6) |
Total lease cost | $ 6.4 | $ 7.1 |
Leases - Summary of Other Infor
Leases - Summary of Other Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Leases [Abstract] | ||
Operating cash flows from operating leases | $ 7.4 | $ 8.5 |
Right-of-use assets obtained in exchange for lease obligations, operating leases | $ 3.4 | $ 5.2 |
Weighted average remaining lease term, operating leases (in years) | 6 years 1 month 6 days | |
Weighted average discount rate, operating leases (as a percentage) | 4.60% |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Lease Payments, Net of Sublease Income (Details) $ in Millions | Mar. 31, 2023 USD ($) |
Operating Leases | |
2023 | $ 19.2 |
2024 | 20.9 |
2025 | 17.6 |
2026 | 13.9 |
2027 | 9.4 |
2028 | 8.9 |
Thereafter | 20.4 |
Total minimum lease payments | 110.3 |
Less imputed interest | 15.4 |
Future minimum payments for leases, net of sublease rental income and imputed interest | $ 94.9 |
Pension and Other Retiree Ben_3
Pension and Other Retiree Benefits - Net Periodic Benefit Expense (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Pension | United States | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | $ 0 | $ 0 | |
Interest cost | 2 | 1.2 | |
Expected return on plan assets | (3) | (2.7) | |
Amortization of net loss (gain) | 0.6 | 0.9 | |
Amortization of prior service cost | 0 | 0 | |
Net periodic benefit (income) cost | [1] | (0.4) | (0.6) |
Pension | International | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | 0.1 | 0.3 | |
Interest cost | 4.9 | 2.5 | |
Expected return on plan assets | (5.3) | (4.6) | |
Amortization of net loss (gain) | 1 | 1.4 | |
Amortization of prior service cost | 0.1 | 0 | |
Net periodic benefit (income) cost | [1] | 0.8 | (0.4) |
Post-retirement | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | 0 | 0 | |
Interest cost | 0 | 0 | |
Expected return on plan assets | 0 | 0 | |
Amortization of net loss (gain) | (0.1) | (0.1) | |
Amortization of prior service cost | 0 | 0 | |
Net periodic benefit (income) cost | [1] | $ (0.1) | $ (0.1) |
[1] The components of net periodic benefit (income) cost, other than service cost, are included in the line "Non-operating pension expense (income)" in the Consolidated Statements of Loss. |
Pension and Other Retiree Ben_4
Pension and Other Retiree Benefits - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Defined Benefit Plan Disclosure [Line Items] | |
Expected contributions to defined benefit plans for 2022 | $ 16.9 |
Contributions by company to date | $ 4.5 |
Stock-Based Compensation - Shar
Stock-Based Compensation - Share-based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 5.6 | $ 4.9 |
Stock option compensation expense | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | 1.9 | 2.1 |
RSU compensation expense | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | 2.3 | 2.1 |
PSU compensation expense | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 1.4 | $ 0.7 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) | 3 Months Ended |
Mar. 31, 2023 shares | |
Restricted stock units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Equity instruments other than options granted in period (shares) | 1,647,434 |
Performance stock units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Equity instruments other than options granted in period (shares) | 2,154,290 |
Stock-Based Compensation - Unre
Stock-Based Compensation - Unrecognized Compensation Expense (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Compensation Expense | $ 1.7 |
Weighted Average Years Expense To Be Recognized Over | 1 year 8 months 12 days |
Restricted stock units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Compensation Expense | $ 4.9 |
Weighted Average Years Expense To Be Recognized Over | 2 years 8 months 12 days |
Performance stock units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Compensation Expense | $ 10.2 |
Weighted Average Years Expense To Be Recognized Over | 2 years 3 months 18 days |
Inventories - Components of Inv
Inventories - Components of Inventories (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 90.3 | $ 76.8 |
Work in process | 4.6 | 4.4 |
Finished goods | 327.6 | 314 |
Total inventories | $ 422.5 | $ 395.2 |
Goodwill and Identifiable Int_3
Goodwill and Identifiable Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jan. 01, 2023 | Mar. 31, 2023 | Mar. 31, 2022 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of intangibles | $ 10.9 | $ 11.1 | |
Tilibra Trade Name | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible asset, useful life | 30 years |
Goodwill and Identifiable Int_4
Goodwill and Identifiable Intangible Assets - Summary of Changes in Net Carrying Amount Goodwill By Segment (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Goodwill [Roll Forward] | |
Balance at December 31, 2022 | $ 671.5 |
Foreign currency translation | 0.4 |
Balance at March 31, 2023 | 671.9 |
ACCO Brands North America | |
Goodwill [Roll Forward] | |
Balance at December 31, 2022 | 348 |
Foreign currency translation | 0 |
Balance at March 31, 2023 | 348 |
ACCO Brands EMEA | |
Goodwill [Roll Forward] | |
Balance at December 31, 2022 | 145.6 |
Foreign currency translation | (0.2) |
Balance at March 31, 2023 | 145.4 |
ACCO Brands International | |
Goodwill [Roll Forward] | |
Balance at December 31, 2022 | 177.9 |
Foreign currency translation | 0.6 |
Balance at March 31, 2023 | $ 178.5 |
Goodwill and Identifiable Int_5
Goodwill and Identifiable Intangible Assets - Summary of Gross Carrying Value and Accumulated Amortization By Class of Identifiable Intangible Assets (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 | |
Amortizable intangible assets: | |||
Amortizable intangible assets, Gross Carrying Amounts | $ 941.1 | $ 817.1 | |
Amortizable intangible assets, Accumulated Amortization | (349.3) | (336.2) | |
Amortizable intangible assets, Net Book Value | 591.8 | 480.9 | |
Total identifiable intangibles | |||
Total identifiable intangible assets, Gross Carrying Amounts | 1,236.2 | 1,227.7 | |
Total identifiable intangibles, Accumulated Amortization | (393.8) | (380.7) | |
Total identifiable intangibles, Net Book Value | 842.4 | 847 | |
Trade Names | |||
Amortizable intangible assets: | |||
Amortizable intangible assets, Gross Carrying Amounts | 491 | 369.7 | |
Amortizable intangible assets, Accumulated Amortization | (127.9) | (123) | |
Amortizable intangible assets, Net Book Value | 363.1 | 246.7 | |
Customer and contractual relationships | |||
Amortizable intangible assets: | |||
Amortizable intangible assets, Gross Carrying Amounts | 359.5 | 356.9 | |
Amortizable intangible assets, Accumulated Amortization | (204.7) | (198.2) | |
Amortizable intangible assets, Net Book Value | 154.8 | 158.7 | |
Vendor Relationships | |||
Amortizable intangible assets: | |||
Amortizable intangible assets, Gross Carrying Amounts | 82.4 | 82.4 | |
Amortizable intangible assets, Accumulated Amortization | (12.6) | (11.2) | |
Amortizable intangible assets, Net Book Value | 69.8 | 71.2 | |
Patents | |||
Amortizable intangible assets: | |||
Amortizable intangible assets, Gross Carrying Amounts | 8.2 | 8.1 | |
Amortizable intangible assets, Accumulated Amortization | (4.1) | (3.8) | |
Amortizable intangible assets, Net Book Value | 4.1 | 4.3 | |
Trade Names | |||
Indefinite-lived intangible assets: | |||
Indefinite-lived intangible assets, Gross Carrying Amount | [1] | 295.1 | 410.6 |
Indefinite-lived intangible asset, Accumulated Amortization | [1] | (44.5) | (44.5) |
Indefinite-lived intangible assets, Net Book Value | [1] | $ 250.6 | $ 366.1 |
[1] Accumulated amortization prior to the adoption of authoritative guidance on goodwill and other intangible assets, at which time further amortization ceased. |
Goodwill and Identifiable Int_6
Goodwill and Identifiable Intangible Assets - Amortization Expense and Estimated Future Amortization (Details) $ in Millions | Mar. 31, 2023 USD ($) | [1] |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Estimated amortization expense, 2023 | $ 43.6 | |
Estimated amortization expense, 2024 | 42 | |
Estimated amortization expense, 2025 | 40.4 | |
Estimated amortization expense, 2026 | 38.3 | |
Estimated amortization expense, 2027 | 35.9 | |
Estimated amortization expense, 2028 | $ 33.7 | |
[1] Actual amounts of amortization expense may differ from estimated amounts due to changes in foreign currency exchange rates, additional intangible asset acquisitions, impairment of intangible assets, accelerated amortization of intangible assets and other events. |
Restructuring - Narrative (Deta
Restructuring - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Restructuring and Related Activities [Abstract] | ||
Restructuring charges | $ 3.3 | $ 0.3 |
Restructuring - Summary of Acti
Restructuring - Summary of Activity in Restructuring Liability (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2023 | Mar. 31, 2022 | |||
Restructuring Reserve [Roll Forward] | ||||
Balance at beginning of period | $ 8.7 | $ 4.5 | ||
Provision | 3.3 | 0.3 | ||
Cash expenditures | (2.6) | (1.6) | ||
Non-cash Items/ Currency Change | 0.1 | 0 | ||
Balance at end of period | 9.5 | 3.2 | ||
Employee termination costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Balance at beginning of period | 8.7 | [1] | 3.4 | |
Provision | 2.7 | [1] | 0.3 | |
Cash expenditures | (2.6) | [1] | (1) | |
Non-cash Items/ Currency Change | 0.1 | [1] | 0 | |
Balance at end of period | 8.9 | [1] | 2.7 | |
Termination of lease agreements | ||||
Restructuring Reserve [Roll Forward] | ||||
Balance at beginning of period | 1.1 | |||
Provision | 0 | |||
Cash expenditures | (0.6) | |||
Non-cash Items/ Currency Change | 0 | |||
Balance at end of period | $ 0.5 | |||
Other | ||||
Restructuring Reserve [Roll Forward] | ||||
Balance at beginning of period | [2] | 0 | ||
Provision | [2] | 0.6 | ||
Cash expenditures | [2] | 0 | ||
Non-cash Items/ Currency Change | [2] | 0 | ||
Balance at end of period | [2] | $ 0.6 | ||
[1] We expect the remaining $ 8.9 million employee termination costs to be substantially paid in the next twelve months . We expect the remaining $ 0.6 million of other costs to be substantially paid in the next twelve months . |
Restructuring - Summary of Ac_2
Restructuring - Summary of Activity in Restructuring Liability (Parenthetical) (Details) - USD ($) $ in Millions | 3 Months Ended | ||||||
Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | ||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring reserve | $ 9.5 | $ 8.7 | $ 3.2 | $ 4.5 | |||
Employee termination costs | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring reserve | $ 8.9 | [1] | 8.7 | [1] | $ 2.7 | $ 3.4 | |
Payment period for restructuring costs | 12 months | ||||||
Other | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring reserve | [2] | $ 0.6 | $ 0 | ||||
Payment period for restructuring costs | 12 months | ||||||
[1] We expect the remaining $ 8.9 million employee termination costs to be substantially paid in the next twelve months . We expect the remaining $ 0.6 million of other costs to be substantially paid in the next twelve months . |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2023 | Mar. 31, 2022 | Mar. 31, 2019 | Dec. 31, 2012 | |
Income Tax Examination [Line Items] | ||||
Income tax expense | $ 0.4 | $ 1.7 | ||
Loss before income tax | (3.3) | (1) | ||
Increase (decrease) in income taxes | (1.3) | |||
Decrease in discrete income tax expense | $ 1.2 | |||
Domestic Tax Authority | Internal Revenue Service (IRS) | Earliest Tax Year | ||||
Income Tax Examination [Line Items] | ||||
Open tax year | 2019 | |||
Foreign Tax Authority | Minimum | ||||
Income Tax Examination [Line Items] | ||||
Statutes of limitation, period | 2 years | |||
Foreign Tax Authority | Maximum | ||||
Income Tax Examination [Line Items] | ||||
Statutes of limitation, period | 5 years | |||
Foreign Tax Authority | Australian Taxation Office | Earliest Tax Year | ||||
Income Tax Examination [Line Items] | ||||
Open tax year | 2018 | |||
Foreign Tax Authority | Secretariat of the Federal Revenue Bureau of Brazil | ||||
Income Tax Examination [Line Items] | ||||
Income tax examination, interest expense | $ 0.4 | $ 0.3 | ||
Foreign Tax Authority | Secretariat of the Federal Revenue Bureau of Brazil | Minimum | ||||
Income Tax Examination [Line Items] | ||||
Penalty rate | 75% | |||
Foreign Tax Authority | Secretariat of the Federal Revenue Bureau of Brazil | Earliest Tax Year | ||||
Income Tax Examination [Line Items] | ||||
Open tax year | 2016 | |||
Foreign Tax Authority | Secretariat of the Federal Revenue Bureau of Brazil | Tax Year 2008 to 2010 | ||||
Income Tax Examination [Line Items] | ||||
Additional reserve from a prior period | $ 5.6 | |||
Foreign Tax Authority | Secretariat of the Federal Revenue Bureau of Brazil | Tax Year 2007 to 2012 | ||||
Income Tax Examination [Line Items] | ||||
Unrecognized tax benefits | $ 44.5 | |||
Potential tax adjustment related to related to acquisition purchase price | $ 43.3 | |||
Foreign Tax Authority | Canada Revenue Agency | Earliest Tax Year | ||||
Income Tax Examination [Line Items] | ||||
Open tax year | 2018 | |||
Foreign Tax Authority | Federal Ministry of Finance, Germany | Earliest Tax Year | ||||
Income Tax Examination [Line Items] | ||||
Open tax year | 2017 | |||
Foreign Tax Authority | Swedish Tax Agency (Skatteverket) | Earliest Tax Year | ||||
Income Tax Examination [Line Items] | ||||
Open tax year | 2017 | |||
Foreign Tax Authority | Her Majesty's Revenue and Customs (HMRC) | Earliest Tax Year | ||||
Income Tax Examination [Line Items] | ||||
Open tax year | 2020 | |||
Foreign Tax Authority | Other Noncurrent Liabilities | Secretariat of the Federal Revenue Bureau of Brazil | Tax Year 2007 to 2010 | ||||
Income Tax Examination [Line Items] | ||||
Unrecognized tax benefits | $ 32 | |||
State and Local Jurisdiction | Minimum | ||||
Income Tax Examination [Line Items] | ||||
Statutes of limitation, period | 2 years | |||
State and Local Jurisdiction | Maximum | ||||
Income Tax Examination [Line Items] | ||||
Statutes of limitation, period | 5 years |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Earnings Per Share [Abstract] | ||
Common stock outstanding (in shares) | 94.9 | 96.8 |
Shares related to tax withholding for share-based compensation (in shares) | 0.3 | 0.2 |
Potentially dilutive shares excluded from computation of dilutive earnings per share (in shares) | 11.5 | 9.3 |
Earnings Per Share - Summary of
Earnings Per Share - Summary of Number of Weighted-Average Shares Outstanding (Details) - shares shares in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Weighted Average Number of Shares Outstanding Reconciliation [Abstract] | |||
Weighted-average number of common shares outstanding - basic (in shares) | 94.9 | 96.2 | |
Weighted-average number of common shares outstanding - diluted (in shares) | [1] | 94.9 | 96.2 |
Stock options | |||
Weighted Average Number of Shares Outstanding Reconciliation [Abstract] | |||
Incremental dilutive common shares (in shares) | 0 | 0 | |
Restricted stock units | |||
Weighted Average Number of Shares Outstanding Reconciliation [Abstract] | |||
Incremental dilutive common shares (in shares) | 0 | 0 | |
[1] Due to the net loss during the three months ended March 31, 2023, the denominator in the diluted earnings per share calculation does not include the effects of the stock awards for which the average market price for the period exceeds the exercise price, as it would result in a less dilutive computation. As a result, reporting diluted earnings per share for the three months ended March 31, 2023 are the same as basic earnings per share. |
Derivative Financial Instrume_3
Derivative Financial Instruments - Narrative (Details) - Foreign exchange contracts - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Derivatives not designated as hedging instruments | ||
Derivative [Line Items] | ||
U.S. dollar equivalent notional value | $ 95,100,000 | $ 79,500,000 |
Cash Flow Hedging | Derivatives designated as hedging instruments | ||
Derivative [Line Items] | ||
U.S. dollar equivalent notional value | $ 82,200,000 | $ 108,300,000 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Fair Value of Derivative Instruments (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | $ 2.3 | $ 9.2 |
Derivative Liabilities | 1.9 | 7.5 |
Foreign exchange contracts | Derivatives designated as hedging instruments | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 1.7 | 3.6 |
Foreign exchange contracts | Derivatives designated as hedging instruments | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | 1.1 | 1.9 |
Foreign exchange contracts | Derivatives not designated as hedging instruments | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 0.4 | 0.7 |
Foreign exchange contracts | Derivatives not designated as hedging instruments | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | 0.6 | 0.7 |
Foreign exchange contracts | Derivatives not designated as hedging instruments | Other Noncurrent Assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 0.2 | 4.9 |
Foreign exchange contracts | Derivatives not designated as hedging instruments | Other Noncurrent Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | $ 0.2 | $ 4.9 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Effect of Derivative Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Foreign exchange contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in AOCI (Effective Portion) | $ (0.6) | $ (0.2) |
Foreign exchange contracts | Cost of products sold | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of (Gain) Loss Reclassified from AOCI to Income (Effective Portion) | (0.5) | (2.4) |
Foreign exchange contracts | Derivatives not designated as hedging instruments | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of (Gain) Loss Recognized in Income | $ 1.7 | $ (0.6) |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Schedule of Fair Value of Assets and Liabilities Measured on a Recurring Basis (Details) - Significant Other Observable Inputs (Level 2) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Forward currency contracts, assets | $ 2.3 | $ 9.2 |
Forward currency contracts, liabilities | $ 1.9 | $ 7.5 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total debt | $ 1,099.4 | $ 1,004.9 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Estimated fair value of total debt | $ 1,001.6 | $ 910 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at start of period | $ 810.1 |
Balance at end of period | 809.8 |
Accumulated Other Comprehensive Income (Loss) | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at start of period | (540.3) |
Other comprehensive income (loss) before reclassifications, net of tax | 5.8 |
Amounts reclassified from accumulated other comprehensive income (loss), net of tax | 0.7 |
Balance at end of period | (533.8) |
Derivative Financial Instruments | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at start of period | 1.1 |
Other comprehensive income (loss) before reclassifications, net of tax | (0.5) |
Amounts reclassified from accumulated other comprehensive income (loss), net of tax | (0.4) |
Balance at end of period | 0.2 |
Foreign Currency Adjustments | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at start of period | (380.1) |
Other comprehensive income (loss) before reclassifications, net of tax | 8.9 |
Amounts reclassified from accumulated other comprehensive income (loss), net of tax | 0 |
Balance at end of period | (371.2) |
Unrecognized Pension and Other Post-retirement Benefit Costs | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at start of period | (161.3) |
Other comprehensive income (loss) before reclassifications, net of tax | (2.6) |
Amounts reclassified from accumulated other comprehensive income (loss), net of tax | 1.1 |
Balance at end of period | $ (162.8) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income (Loss) - Reclassification out of AOCI (Details) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Reclassification Out of Accumulated Other Comprehensive Income [Line Items] | |||
Cost of products sold | $ 283.3 | $ 322 | |
Other expense, net | (1.8) | (0.9) | |
Income tax (expense) benefit | (0.4) | (1.7) | |
Net loss | (3.7) | (2.7) | |
Loss before income tax | (3.3) | (1) | |
Amount Reclassified from Accumulated Other Comprehensive Income (Loss) | |||
Reclassification Out of Accumulated Other Comprehensive Income [Line Items] | |||
Net loss | (0.7) | 0 | |
Unrecognized Pension and Other Post-retirement Benefit Costs | Amount Reclassified from Accumulated Other Comprehensive Income (Loss) | |||
Reclassification Out of Accumulated Other Comprehensive Income [Line Items] | |||
Income tax (expense) benefit | 0.5 | 0.5 | |
Net loss | (1.1) | (1.7) | |
Amortization of actuarial loss | [1] | (1.5) | (2.2) |
Amortization of prior service cost | [1] | (0.1) | 0 |
Loss before income tax | (1.6) | (2.2) | |
Foreign exchange contracts | Derivative Financial Instruments | Amount Reclassified from Accumulated Other Comprehensive Income (Loss) | |||
Reclassification Out of Accumulated Other Comprehensive Income [Line Items] | |||
Cost of products sold | 0.5 | 2.4 | |
Income tax (expense) benefit | (0.1) | (0.7) | |
Net loss | $ 0.4 | $ 1.7 | |
[1] These AOCI components are included in the computation of net periodic benefit (income) cost for pension and post-retirement plans. See "Note 5 . Pension and Other Retiree Benefits" for additional details. |
Revenue Recognition - Service o
Revenue Recognition - Service or Extended Maintenance Agreements (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | ||
Unearned revenue associated with outstanding contracts | $ 2.8 | $ 2.8 |
Revenue recognized | $ 1.2 |
Revenue Recognition - Unearned
Revenue Recognition - Unearned Revenue (Details) $ in Millions | Mar. 31, 2023 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Unearned revenue | $ 2.4 |
Expected timing of satisfaction | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Unearned revenue | $ 0.4 |
Expected timing of satisfaction | 12 months |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Disaggregation of Revenue [Line Items] | |||
Net sales | $ 402.6 | $ 441.6 | |
Product and services transferred at a point in time | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 390.3 | 429.3 | |
Product and services transferred over time | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 12.3 | 12.3 | |
ACCO Brands North America | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 176.7 | 208.5 | |
ACCO Brands North America | United States | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 155.1 | 188.5 | |
ACCO Brands North America | Canada | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 21.6 | 20 | |
ACCO Brands EMEA | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | [1] | 135.8 | 156.1 |
ACCO Brands International | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 90.1 | 77 | |
ACCO Brands International | Australia/N.Z. | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 28.3 | 30 | |
ACCO Brands International | Latin America | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 52.4 | 34.4 | |
ACCO Brands International | Asia-Pacific | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | $ 9.4 | $ 12.6 | |
[1] ACCO Brands EMEA is comprised largely of Europe, but also includes export sales to the Middle East and Africa. |
Information on Business Segme_3
Information on Business Segments - Narrative (Details) | 3 Months Ended |
Mar. 31, 2023 Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 3 |
Information on Business Segme_4
Information on Business Segments - Net Sales by Segment (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Segment Reporting Information [Line Items] | ||
Net sales | $ 402.6 | $ 441.6 |
ACCO Brands North America | ||
Segment Reporting Information [Line Items] | ||
Net sales | 176.7 | 208.5 |
ACCO Brands EMEA | ||
Segment Reporting Information [Line Items] | ||
Net sales | 135.8 | 156.1 |
ACCO Brands International | ||
Segment Reporting Information [Line Items] | ||
Net sales | $ 90.1 | $ 77 |
Information on Business Segme_5
Information on Business Segments - Operating Income by Segment (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Segment Reporting Information [Line Items] | |||
Segment operating income | [1] | $ 10.1 | $ 6.8 |
Change in fair value of contingent consideration | 0 | (2.6) | |
Interest expense | 13.9 | 9.7 | |
Interest income | (2.4) | (1.4) | |
Non-operating pension expense (income) | 0.1 | (1.4) | |
Other expense, net | 1.8 | 0.9 | |
Loss before income tax | (3.3) | (1) | |
Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Segment operating income | 22 | 23.7 | |
Corporate | |||
Segment Reporting Information [Line Items] | |||
Segment operating income | (11.9) | (14.3) | |
ACCO Brands North America | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Segment operating income | 5.2 | 13.9 | |
ACCO Brands EMEA | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Segment operating income | 7.8 | 5.6 | |
ACCO Brands International | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Segment operating income | $ 9 | $ 4.2 | |
[1] Operating income is defined as i) net sales; ii) less cost of products sold; iii) less selling, general and administrative expenses; iv) less amortization of intangibles; v) less restructuring charges; and vi) less change in the fair value of contingent consideration. |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Foreign Tax Authority | Secretariat of the Federal Revenue Bureau of Brazil | |
Loss Contingencies [Line Items] | |
Additional tax credit | $ 3 |