Donnelley Financial Solutions, Inc. (NYSE:DFIN) Q1 2024 Earnings Conference Call May 1, 2024 9:00 AM ET

Company Participants

Mike Zhao - Head, Investor Relations
Dan Leib - Chief Executive Officer, Board Member
Dave Gardella - Chief Financial Officer
Eric Johnson - President of Global Investment Companies
Craig Clay - President of Global Capital Markets

Conference Call Participants

Charles Strauzer - CJS Securities
Pete Heckmann - D. A. Davidson
Kyle Peterson - Needham
Raj Sharma - B. Riley Securities

Operator

Thank you for standing by. My name is Kate, and I will be your conference operator today. At this time, I would like to welcome everyone to the Donnelley Financial Solutions’ First Quarter 2024 2023 Earnings Conference Call. [Operator Instructions]

I would like to turn the call over to Mike Zhao, Head of Investor Relations. Please go ahead.

Mike Zhao

Thank you. Good morning, everyone, and thank you for joining Donnelley Financial Solutions' first quarter 2024 results conference call. This morning, we released our earnings report, supplemental trending schedules of historical results, copies of which can be found in the Investors section of our website at dfinsolutions.com.

During this call, we'll refer to forward-looking statements that are subject to risks and uncertainties. For a complete discussion, please refer to the cautionary statements included in our earnings release and further detailed in our most recent annual report on Form 10-K, quarterly report on Form 10-Q and other filings with the SEC. Further, we will discuss certain non-GAAP financial information such as adjusted EBITDA, adjusted EBITDA margin and organic net sales. We believe the presentation of non-GAAP financial information provides you with useful supplementary information concerning the company's ongoing operations and is an appropriate way for you to evaluate the company's performance. They are, however, provided for informational purposes only. Please refer to the earnings release and related tables for GAAP financial information and reconciliations of GAAP to non-GAAP financial information. I am joined this morning by Dan Leib, Dave Gardella, Craig Clay, Eric Johnson, Floyd Strimling and Kami Turner.

I will now turn the call over to Dan.

Dan Leib

Thank you, Mike, and good morning, everyone. We started 2024 by building on the positive momentum in our performance from last year, delivering consolidated organic net sales growth with an improved sales mix, strong year-over-year growth in adjusted EBITDA, adjusted EBITDA margin expansion, and improvements in both operating cash flow and free cash flow. We delivered first quarter net sales of $203.4 million, which increased 2.8% on an organic basis compared to the first quarter of 2023. I am encouraged by the composition of our organic net sales growth. With Software solutions net sales increasing 16%, Tech-enabled services net sales increasing nearly 6% and Print and Distribution net sales declining approximately 20% as we continue to balance our revenue profile to drive improved profitability. The combination of the improved revenue profile, modest consolidated net sales growth, and cost management yielded first quarter adjusted EBITDA of $55.2 million, and adjusted EBITDA margin of 27.1%, both of which are above last year's first quarter, and once again significantly stronger than historical periods with similar revenue profiles.