FOURTH QUARTER 2020 RESULTS

Dan Knotts, CEO

Terry Peterson, CFO

Johan Nystedt, SVP, Finance

FOURTH QUARTER

2020 RESULTSFebruary 24, 2021

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SAFE HARBOR

& NON-GAAP

This presentation contains “forward-looking statements” within the meaning of, and subject to the safe harbor created by, Section 21E

of the Securities Exchange Act of 1934, as amended, with respect to the business, strategy and plans of the Company and its

expectations relating to future financial condition and performance. Readers are cautioned not to place undue reliance on these

forward-looking statements and any such forward-looking statements are qualified in their entirety by reference to the following

cautionary statements. All forward-looking statements speak only as of the date of this presentation and are based on current

expectations and involve a number of assumptions, risks and uncertainties that could cause the actual results to differ materially from

such forward-looking statements. Words such as “believes”, “anticipates”, ”estimates”, “expects”, “intends”, “aims”, “potential”, “will”,

“would”, “could”, “may”, “considered”, “likely”, and variations of these words and similar future or conditional expressions are intended

to identify forward-looking statements but are not the exclusive means of identifying such statements. Such forward-looking

statements are only predictions and involve known and unknown risks and uncertainties. The Company does not undertake to and

specifically disclaims any obligation to publicly release the results of any revisions to these forward-looking statements that may be

made to reflect future events or circumstances after the date of such statement or to reflect the occurrence of anticipated or

unanticipated events. These factors include such risks and uncertainties detailed in the Company’s periodic public filings wi th the SEC,

including but not limited to, those discussed under the “Risk Factors” section in the Company’s Form 10-K for the fiscal year ended

December 31, 2020 and other filings with the SEC and in other investor communications from the Company from time to time.

Use of Forward Looking Statements

This document contains non-GAAP financial measures, including non-GAAP adjusted income from operations, non-GAAP adjusted

operating margin, non-GAAP effective tax rate, non-GAAP adjusted diluted EPS, net organic sales growth rate and gross and net

leverage ratios. The Company believes that these non-GAAP measures, when presented in conjunction with comparable GAAP

measures, provide useful information about its operating results and enhance the overall ability to assess the Company’s financial

performance. Internally, the company uses this non-GAAP information as an indicator of business performance, and evaluates

management’s effectiveness with specific reference to these indicators. These measures should be considered in addition to, not a

substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. A reconciliation of GAAP to non-

GAAP financial measures can be found in our periodic filings with the Securities and Exchange Commission.

Non-GAAP Financial Information

Note on Continuing Operations

Beginning in the third quarter of 2020, we have reflected our Logistics business as discontinued operations for all periods presented.

Our references to net sales, SG&A, income from operations, net income or loss, and per share amounts in this presentation are on a

continuing operations basis without Logistics. All prior periods presented have been restated to conform to this presentation.

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Protecting the health and safety of our employees, clients, partners and suppliers

COVID-19 OPERATING PRIORITIES

RRD's COVID-19 Operating Plan | Key Focus Areas

Protecting

the Health and

Safety of

Our Employees

Maintaining

Operational

Continuity

Managing

Business

Performance

Slide / 4

2020 YEAR IN REVIEW

Improve

Financial Flexibility

• Reduced total debt by $315 million; total reduction from 2016 now at $884 million

• Aggregate amount of Senior Notes and Debentures due through 2024 reduced $750 million

during the year, from $1.0 billion to $272 million

• Sold Logistics businesses and six facilities ($255 million), collected additional deposit for the

China building sale ($25 million) and liquidated certain life insurance policies ($96 million)

Firmly on our strategic path to advance RRD as a leading provider of marketing and business communications

Drive Revenue

• Captured new sales opportunities as a result of the pandemic

• Leveraged extensive capabilities to expand client relationships

• Implemented innovative solutions to solve evolving client needs

Strengthen Core

• Sold low margin Logistics businesses

• Exited Chile market

• Reorganized functions across all segments, consolidated facilities, and rationalized assets

• Accelerated cost reduction initiatives; reduced full year adjusted SG&A expense $95.7 million

Slide / 5

Highlights

• Net sales improved sequentially from previous

quarter and exceeded mid-point of previous

expected range by more than $150 million

• Adjusted IFO slightly up versus prior year;

adjusted operating margin improved by 50 bps

driven by aggressive cost-out actions

• Total debt down $518 million in the quarter;

finished the year $315 million better versus prior

year end

• Total liquidity at $865 million, up $322 million

from third quarter

• Gross leverage ratio of 3.7x at year end

improved 1.0x from third quarter; net leverage

ratio of 3.0x improved 0.7x from third quarter

• Collected $244 million primarily from selling

Logistics businesses and three additional

buildings; generated $96 million of proceeds

from liquidating life insurance policies

Sales • Consolidated

– Reported: (5.6%)

– Organic: (4.8%)

• Organic by segment

– Business Services: 1.7%

– Marketing Solutions: (22.8%)

– Business Services growth driven primarily

by higher Supply Chain Services and

Packaging product volumes. Both

segments negatively impacted by lower

volumes resulting from the pandemic;

Marketing Solutions further impacted by

lower Census volume

• Income from operations:

– GAAP: $78.1m

– Non-GAAP adjusted:

$94.5m

• Operating margin:

– GAAP: 5.8%

– Non-GAAP adjusted: 7.0%

Profitability • Effective tax rate:

– GAAP: 28.0%


• Diluted EPS from continuing

operations:

– GAAP: $0.46

– Non-GAAP adjusted: $0.71

• Cash provided by operating

activities: $124.6m

• CapEx: $31.2m

• Total debt: $1.50b

Cash/Debt • Interest expense: $32.4m

• Cash and cash equivalents: $288.8m

• Gross leverage ratio: 3.7x

• Net leverage ratio: 3.0x

FOURTH QUARTER

OVERVIEW

A reconciliation of GAAP to non-GAAP financial measures can be found in our periodic filings with the SEC.

Slide / 6

Highlights

• Despite 2020 net sales decrease of 12.9%,

adjusted IFO up $5.5 million versus prior year;

adjusted operating margin improved by 70 bps

driven by aggressive cost-out actions

• Adjusted SG&A decreased $95.7 million, or

13.9%, versus prior year

• Adjusted EPS from continuing operations of

$1.21 increased from $0.52 in the prior year

• Operating cash flow increased $10.5 million

versus prior year

• Total debt outstanding at $1.5 billion, a reduction

of $315 million during the year

• Gross leverage ratio of 3.7x improved 0.5x from

prior year end; net leverage ratio of 3.0x

improved 0.7x from prior year end

• Availability under the credit facility at $575.9

million and total liquidity of $865 million is up $40

million from prior year

• Sold Logistics businesses; exited Chile market

Sales • Consolidated

– Reported: (12.9%)

– Organic: (9.0%)

• Organic by segment

– Business Services: (6.9%)


– Both segments negatively

impacted by lower volumes

resulting from the pandemic

and lower pricing; Marketing

Solutions further impacted by

lower Census related sales

• Income from operations:

– GAAP: $108.1m

– Non-GAAP adjusted:

$239.7m

• Operating margin:

– GAAP: 2.3%


Profitability • Effective tax rate:

– GAAP: (62.9%)


• Diluted EPS from continuing

operations:

– GAAP: ($0.37)

– Non-GAAP adjusted: $1.21

• Cash provided by operating

activities: $149.8m

• CapEx: $85.6m

• Total debt: $1.50b

Cash/Debt • Interest expense: $135.1m

• Cash and cash equivalents: $288.8m

• Gross leverage ratio: 3.7x

• Net leverage ratio: 3.0x

FULL YEAR

OVERVIEW

A reconciliation of GAAP to non-GAAP financial measures can be found in our periodic filings with the SEC.

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MOBILIZE COVID-19 TEST KITS

Healthcare providers look to RRD’s

end-to-end supply chain

• Source, assemble, ship

COVID-19 test kits

• Regulatory credentials

INCREASED SAFETY FOR FAST-CASUAL RESTAURANTS

Box closures and labels provide

customer reassurance during

pandemic

• Large operating scale

• RRD technology platform

seamlessly fulfills company’s

orders

Large Health Insurance Organization

RRD KEEPS CLIENTS CONNECTED WITH CUSTOMERS

Care package promotes health and well-

being during winter

• Large-scale project with short lead

time

• Enterprise-grade packaging,

commercial print, and supply chain

capabilities

NEW CLIENT WINS

Slide / 8

VACCINATION DISTRIBUTION TOOLKIT

• Marketing, communications, operational support

• Efficient mobilization of vaccine awareness

• Target clients: healthcare providers, government

agencies, retail pharmacies, and large enterprise

organizations

CONNECT ONE BY RRD

• Communications management platform

• Technologies for marketing automation, digital

asset management, personalization at scale

• Target clients: large corporations across financial,

hospitality, retail, automotive, etc.

NEW SOLUTION OFFERINGS

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APP CLIP CODES• Lightweight versions of applications

• Visually distinct decals

• Integrate digital variable text and graphical print with

NFC technology

TOUCHLESS WORLD BY RRD• Prioritizes consumer safety

• Contactless brand touch points

• NFC, QRC-powered interactions

INNOVATIVE SOLUTIONS TO CAPTURE EVOLVING MARKET

OPPORTUNITIES

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AWARDS AND LISTINGS

2020 PROMOTING SOCIAL INCLUSION AWARD

RRD’s recognition is directly attributed

to the work RRD did to bring digital jobs

to the Himalaya

3M SUPPLIER OF THE YEARENEL X SUSTAINABLE FOOTPRINT

AWARD

RRD honored among 20 suppliers out

of the thousands of companies

supporting 3M’s global supply base

RRD noted for exceptional contribution

to supporting a stronger, more resilient

and sustainable energy grid through

demand response

Slide / 11

FOURTH QUARTER NET SALES PERFORMANCE (AS REPORTED) ($ In millions)

Business Services(1) Marketing Solutions Consolidated(1)

` Q4 2020 YOY Change

Commercial Print(2)

$371.1 (10.7%)

Packaging $228.5 24.0%

Labels $136.7 2.6%

Supply Chain Management $117.9 54.5%

Statements(2)

$108.5 (15.4%)

Forms $53.2 (15.2%)

Business Process

Outsourcing(2) $43.9 (19.6%)

Total – Reported(1)

$1,059.8 0.4%

Total – Organic(3)

1.7%

Q4 2020 YOY Change

Direct Marketing $138.6 (29.9%)

Digital Print & Fulfillment $123.1 (15.0%)

Digital & Creative Solutions $27.1 (13.7%)

Total – Reported $288.8 (22.8%)


(22.8%)

Q4 2020 YOY Change

US(2)

$959.1 (8.0%)

Asia $275.4 18.1%

Europe(2)

$57.8 (30.0%)

Other $56.3 (21.2%)


$1,348.6 (5.6%)


(4.8%)

By Products and Services By Products and Services By Geography

35%

22%

13%

11%

10%

5% 4% Commercial Print

Packaging

Labels

Supply Chain Mgmt

Statements

Forms

BPO

48%

43%

9%

Direct Marketing

Digital Print & Fulfillment

Digital & Creative

71%

21%

4% 4%

US

Asia

Europe

Other

$1,059.8$288.8

$1,348.6

(1) Individual products, services and geographical categories YOY change are as reported and do not reflect the impact of business dispositions and FX.

(2) Products and service categories negatively impacted by business dispositions and/or significant closures (Commercial Print, Statements and BPO).

(3) A reconciliation of GAAP to non-GAAP financial measures can be found in our periodic filings with the SEC.

Slide / 12

FINANCIAL TRENDS – PROFITABILITY

• Adjusted income from operations up $1.2

million and margins increased 50 bps vs.

prior year period primarily due to:

– Favorable factors: Actions to reduce cost

structure and lower depreciation and

amortization expense

– Unfavorable factors: Impact from lower

sales, higher incentive compensation and

~$10 million from unfavorable f/x

• Adjusted EPS also benefited from:

– Lower effective tax rate associated with

recent tax law guidance and from the

CARES Act

– $2.6 million reduction in interest expense

COMMENTS ON

Q4 PERFORMANCE

Quarterly

Non-GAAP Adjusted EPS from

Continuing Operations(1)

Non-GAAP Adjusted Income from

Operations(1) ($ In millions)

$33.2 $33.5

$74.2

$93.3

$50.5

$20.8

$73.9

$94.5

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

$0.43

$0.71

Q4 Q4

20202019 20202019

Annual

$234.2$239.7

2019 2020


$0.52

$1.21

2019 2020

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BALANCE SHEET AND CASH FLOW ($ In millions)

Total Debt

Capital ExpendituresOperating Cash Flow

Cash & Cash Equivalents

Delivered on debt reduction

amid COVID-19 pandemic

• Reduced total debt by $315 million during

2020

• Full year improvement in free cash flow

• Generated proceeds from selling Logistics,

6 additional facilities and liquidating

insurance policies

Asset based lending agreement:

• $800 million facility with maturity in 2022

• Zero drawn; $575.9 million available as of

December 31, 2020

Full year operating cash flow improved

• Deferral of employer portion of payroll taxes

• Working capital improvements

• Interest payments reduced by $31 million

• Partially offset by $47 million paid to

terminate 25 deferred compensation plans

$274.3 $220.5

$144.7

$191.9

$450.7

$341.9 $414.8

$288.8

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

2020

$2,171.8 $2,121.4

$2,029.1 $1,818.4

$2,168.4 $2,035.9 $2,021.3

$1,503.1

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

2020

-$130.0

$12.9 $29.3

$227.1

-$79.6

$35.4$69.4

$124.6

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

$37.4 $39.0

$31.0 $31.4

$17.7 $20.4

$16.3

$31.2

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

2019 2019

202020202019 2019

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CUMULATIVE EFFORTS TO IMPROVE BALANCE SHEET FLEXIBILITY

• Planned sale of Shenzhen, China printing

facility for approximately $250 million in 2022;

$123.3 million in deposits collected through

December 31, 2020

• Generated $96 million in proceeds from

liquidating certain insurance policies in 2020

• Since January 2017, sold thirteen facilities

totaling approximately $40 million, including

six facilities sold in 2020 for approximately

$14 million

• Sold investment in LSC in 2017 for $121.4

million

• Completed non-cash debt to equity exchange

of investment in DFS in 2017 for $111.6

million

• Sold other investments in 2017 and

2018 for approximately $13 million

Sale of Properties &

InvestmentsBusiness Dispositions

• Sold International Mail and Parcel Logistics

business for $13 million

• Sold Logistics DLS Worldwide business for

$225 million

• Sold Logistics Courier business in March

2020 for $10.4 million

• Exited Chile operations in February 2020

• Sold GDS business in October 2019 for $53.7

million

• Sold R&D business in May 2019 for $11.6

million

• Sold Print Logistics business in July 2018 for

$43.9 million

Total liquidity of $865 million as of December 31, 2020

• Operating cash flow improved $10.5 million

from prior year for the twelve months ended

December 31, 2020; capital expenditures

decreased $53.2 million versus prior year

• Reduced annual interest expense $63.6

million from 2016 to 2020 including a

reduction of $15.5 million in 2020 versus prior

year

• Working capital improvements

• Total international cash repatriation in 2020

was $45 million; $327 million repatriated in

2019

Cash Flow

Slide / 15

CURRENT DEBT MATURITY PROFILE(1)($ In millions)

(1) Reflects outstanding principal balance

• Recent exchanges,

repurchases and

repayments have reduced

Senior Notes and

Debentures due through

2024 by $750 million since

beginning of year; only $135

million of debt maturing over

next two years

• Reduced debt by $315

million during 2020

• Reduced 2021 and 2022

maturities by $108 million in

fourth quarter, including the

redemption of remaining

$83 million of March 2021

notes

COMMENTS

ON DEBT

PROFILE

$66$167

$60

$140

$291 $298

$158$69

$42

$758$545

$0

$200

$400

$600

$800

$1,000

2020 2021 2022 2023 2024 2027 2029 2031

Debt Maturities - December 31, 2019

$56 $79 $75 $62

$245 $104

$318

$54

$800

$539

$0

$200

$400

$600

$800

$1,000

2020 2021 2022 2023 2024 2027 2029 2031

Debt Maturities - December 31, 2020

7.625% Notes due June 15, 2020 7.875% Notes due March 15, 2021 8.875% Debentures due April 15, 2021

7.000% Notes due February 15, 2022 6.500% Notes due November 15, 2023 6.000% Notes due April 1, 2024

8.250% Notes due July 1, 2027 6.625% Debentures due April 15, 2029 8.500% Notes due April 15, 2029

8.820% Debentures due April 15, 2031 ABL Revolving Credi t Facility ($800 mill ion) - Drawn ABL Revolving Credit Facility ($800 mill ion) - Undrawn

Term Loan B due January 15, 2024 (annual payments of $5.5 million)

Slide / 16

2021 OUTLOOK

Full year adjusted IFO and

operating margin are

expected to be flat to up

slightly

Q1 adjusted IFO expected

to be slightly lower

• Impact of reduced sales

• Offset by aggressive cost

reduction actions

Interest expense is

expected to range from

$120 to $125 million, and

full year Non-GAAP

effective tax rate expected

to be approximately 35%

Operating cash flow is

expected to be slightly

lower due to the repayment

of a portion of the payroll

tax deferral. Capital

expenditures are expected

to be approximately $80

million. Expect to collect

approximately $50 million

deposit, as part of

agreement to sell the

printing facility in China

Expect to address existing

credit facility in the first half

of the year

Expect to continue

generating additional

proceeds from monetizing

other assets including

proceeds from selling

facilities

Full year net sales

expected to be flat to up

low single digits

Q1 net sales expected

to be down five to ten

percent organically

• Further impact from the

pandemic

• Census work in the prior

year that will not repeat

• Offset by modest

economic recovery as

year progresses

Slide / 18

KEY TAKEAWAYS

Strong Q4 operating

performance

reflected:

• Better than expected

sales performance

• Aggressive cost-out

actions improved

adjusted operating

margins 50 bps and

grew adjusted income

from operations

Continue to leverage

scale and portfolio

diversification to

capture new market

opportunities and

expand client

relationships

Improved full year

operating cash flow

versus prior year

• Working capital

improvements

• Lower interest

payments

Advanced strategic

priorities

• Completed

divestitures of

remaining logistics

businesses

• Liquidated certain

insurance policies

• In 2020, reduced total

debt by $315 million

and improved gross

leverage by 0.5x

APPENDIX

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FULL YEAR NET SALES PERFORMANCE (AS REPORTED) ($ In millions)

Business Services(1) Marketing Solutions Consolidated(1)

` FY 2020 YOY Change

Commercial Print(2)

$1,357.7 (19.9%)

Packaging $687.6 2.9%

Labels $496.6 (0.2%)

Statements(2)

$441.6 (19.0%)

Supply Chain Management $329.9 10.4%

Forms $202.4 (17.2%)

Business Process

Outsourcing(2) $169.4 (30.5%)


$3,685.2 (12.1%)


(6.9%)

FY 2020 YOY Change

Direct Marketing $555.4 (17.9%)

Digital Print & Fulfillment $425.7 (13.5%)

Digital & Creative Solutions $100.0 (10.5%)

Total – Reported $1,081.1 (15.6%)


(15.6%)

FY 2020 YOY Change

US(2)

$3,451.3 (10.4%)

Asia $868.9 (4.3%)

Europe(2)

$224.5 (48.4%)

Other $221.6 (20.4%)


$4,766.3 (12.9%)


(9.0%)

By Products and Services By Products and Services By Geography

37%

19%

13%

12%

9%

5% 5% Commercial Print

Packaging

Labels

Statements

Supply Chain Mgmt

Forms

BPO

51%

40%

9%

Direct Marketing

Digital Print & Fulfillment

Digital & Creative

72%

18%

5%5%

US

Asia

Europe

Other

$3,685.2$1,081.1

$4,766.3

(1) Individual products, services and geographical categories YOY change are as reported and do not reflect the impact of business dispositions and FX.

(2) Products and service categories negatively impacted by business dispositions and/or significant closures (Commercial Print, Statements and BPO).


Slide / 21

FINANCIAL TRENDS – ORGANIC SALES

• Organic rate by segment:

– Business Services: 1.7%


• Business Services experienced growth driven

by higher Supply Chain Services and

Packaging product volumes. Both segments

negatively impacted by lower volumes

resulting from the COVID-19 pandemic and

lower pricing, partially offset by new

pandemic related sales; Marketing Solutions

further impacted by a reduction in Census

related sales

• Three primary factors helped lessen the top

line impact from the pandemic:

– Diversification of products & services

– Limited client & industry concentration

– New products & services introduced to meet

the evolving needs of clients

COMMENTS ON

Q4 PERFORMANCE

0.0%

-0.4%-1.2%

-9.0%2017 2018 2019 2020

Annual

2020


Organic Sales Change(1)

-2.9% -1.6%

1.2%

-1.7% -1.7%

-17.8%

-12.1%

-4.8%

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

2019

Quarterly

Slide / 22

FOURTH QUARTER OPERATING PERFORMANCE

($ In millions) Q4 2020 Q4 2019

Better/(Worse)Organic Sales

Change(1)

$ %

Net Sales $1,348.6 $1,429.2 ($80.6) (5.6%) (4.8%)

Business Services $1,059.8 $1,055.2 $4.6 0.4% 1.7%

Marketing Solutions $288.8 $374.0 ($85.2) (22.8%) (22.8%)

Adjusted Income from Operations(1) $94.5 $93.3 $1.2 1.3%

Business Services $103.1 $79.9 $23.2 29.0%

Marketing Solutions $25.3 $28.9 ($3.6) (12.5%)

Corporate ($33.9) ($15.5) ($18.4) (118.7%)

Adjusted Operating Margins(1) 7.0% 6.5% 50 bps

Business Services 9.7% 7.6% 210 bps

Marketing Solutions 8.8% 7.7% 110 bps


Slide / 23

FULL YEAR OPERATING PERFORMANCE

($ In millions) FY 2020 FY 2019

Better/(Worse)Organic Sales

Change(1)

$ %

Net Sales $4,766.3 $5,473.2 ($706.9) (12.9%) (9.0%)

Business Services $3,685.2 $4,192.7 ($507.5) (12.1%) (6.9%)

Marketing Solutions $1,081.1 $1,280.5 ($199.4) (15.6%) (15.6%)

Adjusted Income from Operations(1) $239.7 $234.2 $5.5 2.3%

Business Services $249.5 $242.3 $7.2 3.0%

Marketing Solutions $66.3 $68.6 ($2.3) (3.4%)

Corporate ($76.1) ($76.7) $0.6 0.8%

Adjusted Operating Margins(1) 5.0% 4.3% 70 bps

Business Services 6.8% 5.8% 100 bps

Marketing Solutions 6.1% 5.4% 70 bps


Slide / 24

THANK YOU

FOURTH QUARTER 2020 RESULTS

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