Multi-Color Corp. (NASDAQ:LABL) Q3 2019 Earnings Conference Call Transcript
Feb 11, 2019 • 05:00 pm ET
Good day, ladies and gentlemen, and welcome to the Third Quarter 2019 Multi-Color Corp 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'd now like to introduce your host for today's conference, Ms. Sharon Birkett, Vice President and Chief Financial Officer. Ma'am, you may begin.
Sharon E. Birkett
Thank you, Nimmy. Welcome to Multi-Color Corporation's Fiscal 2019 Third Quarter Conference Call and Webcast for the period ending December 31, 2018. We're also broadcasting this live over the Internet, accessible through the Multi-Color website, 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 Chairman -- our Executive Chairman. I will begin with an overview of how our company performed this period and provide analysis of our financial results. Nigel will conclude with final comments, and then we will 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. I'll remind you that in accordance to 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 turn to slide number one, net revenues. In the third quarter of fiscal 2019, net revenues increased 13% to $397 million compared to $353 million in the prior year quarter. Acquisitions accounted for 16% increase in revenues. Organic revenues was negatively impacted by 1% relating to the timing of revenue recognition, due to the adoption of the new revenue standard in April 2019. The remaining organic revenues were flat due to softer beverage and personal care volumes in the United States, partially offset by strong organic growth in developing markets.
Foreign exchange led to a 3% decrease in revenues, primarily driven by depreciation of the Euro and the Australian dollar quarter-over-quarter. For the nine months ended December 31, net revenues increased 51% to $1.28 billion compared to $851 million in the prior year. Acquisitions accounted for 50% increase in revenues, net of divestitures. Organic revenue year-to-date increased 2% with growth in developed markets in the low single digits and growth in developing markets in the high single digits. The impact of the timing of revenue recognition with the adoption of new accounting standard resulted in a net $3.8 million reduction in revenues compared to prior year. Foreign exchange led to a 1% decrease in revenues year-to-date.
Please turn to slide number two, gross margins. Gross profit -- sorry, core gross profit increased 5% or