R.R. Donnelley & Sons Company (NYSE:RRD) Q4 2019 Earnings Conference Call - Final Transcript
Feb 26, 2020 • 11:00 am ET
[Operator Instructions] And we'll go to line of Jamie Clement with Buckingham. please go ahead.
Hey, gentlemen, good morning. Thanks for taking my class. Dan, can you kind of give us an update of where you see your logistics business. Obviously, some revenue challenges, I think, industry-wide, a little bit in 2019. Can you kind of give us a sense of where you think you are kind of in the mini cycle and caveat outlook for 2020?
Daniel L. Knotts
Sure, Jamie. I think if you look at the cycle that really was very strong in 2018, that really began to take a move towards a downward trajectory fairly quickly at the end in the fourth quarter of 2018. As we move into 2019, we expected that trajectory to continue, which it did. And I think the key here is, as we look at the logistics market across all of 2019, Q4 was really the lapping quarter, and didn't see tremendous stabilization there that was really expected for the industry. So a little bit of a surprise in Q4 from an industry dynamic perspective.
As we start 2020, I think if you look at all the different players that are out there that have reported and reading through all their transcripts, et cetera, you see kind of a mixed bag of projections for the year, which is kind of how we feel about it as well. There are those who are projecting a softer first half, a stronger back half. There are those who have seen volume uptick early on in the year. And there are those who believe that the full year is going to continue to be challenged. So across that, it runs the gamut in terms of what people are saying overall about the industry. The question is, does COVID-19 have an impact on product that's coming to the U.S.? And does that ramp back up? Is that temporary or not? But I feel pretty good about our start to the year for our logistics business.
Okay. Thanks very much. I appreciate it.
And next, we'll go to the line of Charlie Strauzer with CJS. Please go ahead.
Good morning, Terry, just you gave a lot of stats at the end there, just I can clarify with you, you've mentioned $212 million of kind of exited and sold revenue impacting the top line guidance. Is that correct?
Terry D. Peterson
Yes. And that's primarily the GDS sale that we completed in October. And then also, we have one final quarter from the Brazil closure.
Got it. And also, you mentioned, too, in the Q1 commentary, just saying you thought that the basis would be kind of flattish, but China would be impacted by about $50 million. Is that correct on the top line?
Terry D. Peterson
Yes. That's correct.
Okay. Good to hear. And then maybe, Dan, just if you could give a little bit more color to kind of pick up on Jamie's question on now shifting to the kind of commercial print side. Trends you're