Sales in LSC Communications' book division rose 3.2% in 2018 over 2017, to $1.06 billion, the company said in its recently filed 10-L report with the SEC. The gain, LSC said, came primarily as a result of higher volume sales in educational books and digital products, increased fulfillment services, and a $10 million increase in pass-through paper sales, all of which were partially offset by price pressures.
The book group benefited from a solid fourth quarter, in which revenue rose 5.1%, to $258 million, driven by higher education book volume and pass-through paper costs. Profit in the group, however, fell 4%, to $58 million, which LSC attributed to cost increases as a result of the labor market conditions, price declines, mix of volume, and a gain on the sales of assets recorded in 2017. During the year, LSC reported that it closed three book printing plants.
Overall, the company, which is set to be acquired by rival Quad (formerly Quad Graphics) later this year, reported sales of $3.83 billion—a 8.5% increase that was made possible largely due to acquisitions. LSC also cut its net loss to $23 million, from $57 million, in 2017. Part of the reason for smaller loss was a reduction in impairment, which cost LSC $129 million in 2017 but only $35 million last year.
Commenting on results in in a statement contained in a releasing announcing LSC's 2018 results, Thomas J. Quinlan III, LSC Communications’ chairman, president, and CEO, stated: “As we enter 2019, we continue to focus on providing innovative customer solutions and ways to better reduce costs and improve productivity resulting in increased earnings. We continue to expect to close on the merger with Quad/Graphics in mid-2019.”
