Worldcolor, which went into and emerged from bankruptcy in mid-2009, generated a net loss for the year of $154 million, a significant improvement over the $1.66 billion net loss it posted in 2008.
The company’s operating revenue shrunk from just over $4 billion in 2008 to $3.07 billion last year. But it did post operating income of $64 million in 2009, compared with an operating loss of $462 million a year earlier. The 2008 results included goodwill impairment of $324 million.
Worldcolor’s North American operations pulled in $2.83 billion, down from $3.72 billion a year earlier. But this unit’s earnings before income taxes amounted to $129 million, or 4.6% of its revenue, compared with $100 million, or 3% of its pre-tax earnings in 2008.
Its Latin American unit continued to post higher earnings margins, although these slipped between 2008 and 2009. In 2008, Worldcolor’s Latin American business pulled in $295 million, with $17 million in pre-tax earnings (5.8%), while in 2009 its revenue fell to $247 million, and its earnings dropped to $13 million, or 5.3%.
Worldcolor’s board of directors has approved a plan under which it will be acquired by Quad/Graphics. The transaction, which is expected to close during the summer, will result in Worldcolor shareholders receiving 40% of the outstanding shares of Quad/Graphics and Quad/Graphics shareholders receiving 60%. Quad/Graphics intends to become a publicly traded firm upon the deal’s closing.
