Veritiv Corporation (NYSE:VRTV) Q4 2015 Earnings Conference Call - Final Transcript

Mar 15, 2016 • 10:00 am ET


Veritiv Corporation (NYSE:VRTV) Q4 2015 Earnings Conference Call - Final Transcript


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Good morning and welcome to Veritiv Corporation's Fourth Quarter and Full Year 2015 Financial Results Conference Call. We will begin with opening remarks and introductions. At this time, I would like to turn the call over to Tom Morabito, Director of Investor Relations. Mr. Morabito, you may begin.

Tom Morabito

Thank you, Shawn and good morning everyone. Thank you all for joining us. Today, you will hear prepared remarks from Mary Laschinger, our Chairman and Chief Executive Officer and Steve Smith, our Chief Financial Officer. Afterwards, we will take your questions. Before we begin, please note that some of the statements made in today's presentation regarding the intentions, beliefs, expectations and/or predictions of the future by the company and or management are forward-looking.

Actual results could differ in a material manner. Additional information that could cause results to differ from those in the forward-looking statements is contained in the company's SEC filings. This includes, but is not limited to risk factors to be contained in our 2015 Annual Report on Form 10-K and in the news release issued this morning, which is posted in the Investors section at Non-GAAP financial measures are included in our comments today and in the presentation slides. The reconciliation of these non-GAAP measures to the applicable GAAP measures are included at the end of the presentation slides and can also be found in the Investors section of our website.

At this time, I would like to turn the call over to Mary.

Mary A. Laschinger

Thanks, Tom. Good morning, everyone and thank you for joining us today as we review our fourth quarter and full year financial results. We will also cover key accomplishments in 2015, set our 2016 guidance and provide initial thoughts on some of the key drivers of our full year performance. For the full year 2015 compared to the prior year, on a pro forma basis, net sales were $8.7 billion and down approximately 6%. Despite the top line pressures, we exceeded our 2015 adjusted EBITDA commitment to shareholders and reported consolidated adjusted EBITDA of $182 million, more than an 18% increase year-over-year. This increase was primarily a result of our strong program management of the integration, strategic management of margin and price mix and a benefit from lower fuel prices. We remained on track with our long-term goal to improve adjusted EBITDA by an incremental $100 million in the first few years post merger and are well-positioned to enter our next phase of synergy capture in 2016.

Our disciplined focus on the integration initiatives allowed us to place ahead of our original synergy plan and we were able to capture approximately 55% of our cumulative forecasted synergy range of $150 million to $225 million. This was accelerated by solid execution against our sourcing strategies and operational initiatives in both 2014 and 2015 and was a significant driver of our full year earnings. From a top line perspective, our full year revenue decline was affected by three main elements. First, due to the year's calendar structure,