Multi-Color Corp. (NASDAQ:LABL) Q4 2018 Earnings Conference Call - Final Transcript

May 29, 2018 • 10:00 am ET

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Multi-Color Corp. (NASDAQ:LABL) Q4 2018 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day, ladies and gentlemen, and welcome to the Q4 2018 Multi-Color Corporation Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time.

(Operator Instructions)

As a reminder, this conference call is being recorded.

I would now like to introduce your host for today's conference, Ms. Sharon Birkett, Chief Financial Officer of Multi-Color Corporation. Ma'am, you may begin.

Executive
Sharon Birkett

Thank you, Joel. Welcome to Multi-Color Corporation's fiscal 2018 fourth quarter conference call and webcast for the period ending March 31, 2018. We're also broadcasting this live over the Internet, accessible through our Multi-Color Web site at www.mcclabel.com, on our Investor Relations page.

I'm Sharon Birkett, Vice President and CFO of Multi-Color. I'll be leading today's call. And I'm joined by Nigel Vinecombe, our Executive Chairman. I will begin with an overview of how our Company performed this period and provide a detailed analysis of our results. And Nigel will conclude with final comments and take your questions.

Before we discuss our results, I want to call your attention to the Safe Harbor statement that was displayed on the registration page you viewed right after you logged on to the webcast, and remind you that in accordance with the Private Securities Litigation Act of 1995, this presentation may contain some forward-looking statements that involve both known and unknown risks that may affect the outcome of our results. This Safe Harbor statement is also included in our earnings release and in our filings with the SEC.

For those of you who are listening and viewing our webcast via the Internet, please take a look at Slide number 2, net revenues. In the fourth quarter of fiscal 2018, net revenues increased 84% to $449.7 million compared to $244 million in the prior-year quarter. Acquisitions, net of divestitures occurring after the beginning of the fourth quarter of fiscal 2017, accounted for a 78% increase in revenues. Organic revenues increased 1% and foreign exchange rates, primarily driven by the appreciation of the euro, led to a 5% increase in revenues.

In addition, revenues for fiscal 2018 increased 41% to $1.3 billion compared to $923.3 million in the prior year. Acquisitions occurring after the beginning of fiscal 2017 accounted for a 35% increase in revenues, net of divestitures. Increased revenues globally led by North America contributed to an organic revenue increase of 4% and foreign exchange rates, primarily driven by the appreciation of the euro, led to 2% increase in revenues year-over-year.

Please turn to Slide number 3, gross profit margins. Core gross profit increased 65% or $35.1 million compared to the prior-year quarter. Acquisitions occurring after the beginning of the fourth quarter of fiscal 2017 contributed 59% or $31.8 million to core gross profit net of divestitures. Organic gross profit increased 2% or $1.1 million. The remaining increase of 4% or $2.2 million, related to foreign exchange. Core gross margins were 20% of net revenues in the current-year quarter compared