Veritiv Corporation (NYSE: VRTV), a North American leader in business-to-business distribution solutions, today announced financial results for the third quarter ended September 30, 2020.

"Continuing execution of our multi-year strategy and broad-based efficiency programs led to record Adjusted EBITDA margins in the third quarter," said Sal Abbate, Chief Executive Officer. "We are fully operational and meeting the needs of our employees and customers both safely and efficiently. Our significantly improved fundamentals and the flexibility of our business model drove a year-over-year improvement in Adjusted EBITDA despite a challenging and dynamic market environment."

For the three months ended September 30, 2020, compared to the three months ended September 30, 2019:

• Net sales were $1.6 billion, a decrease of 17.3% from the prior year. The foreign currency effect on net sales was negligible.
• Net income was $21.1 million, compared to net income of $5.1 million in the prior year. Net restructuring charges were $7.9 million in the third quarter of 2020 compared to $7.6 million in the prior year.
• Basic and diluted earnings per share were $1.33 and $1.30, respectively, compared to $0.32 and $0.31, respectively, in the prior year.
• Adjusted EBITDA was $49.9 million, an increase of 10.9% from the prior year.
• Adjusted EBITDA as a percentage of net sales was 3.1%, an increase of 80 basis points from the prior year.

For the nine months ended September 30, 2020, compared to the nine months ended September 30, 2019:

• Net sales were $4.7 billion, a decrease of 19.2% from the prior year. Net sales decreased 19.5% from the prior year, excluding the negative effect of foreign currency.
• Net income was $2.2 million, compared to net loss of $(32.9) million in the prior year. Net restructuring charges were $40.4 million in 2020 compared to $16.9 million in the prior year.
• Basic and diluted earnings (loss) per share were $0.14 compared to $(2.05) in the prior year.
• Adjusted EBITDA was $125.9 million, an increase of 15.8% from the prior year.
• Adjusted EBITDA as a percentage of net sales was 2.7%, an increase of 80 basis points from the prior year.

For the quarter ended September 30, 2020, net cash provided by operating activities was $54.2 million and free cash flow was $49.1 million.

"Our third quarter free cash flow generation was strong due to positive earnings, and lower days sales outstanding and days inventory on hand over sequential quarters, driven by our continuing efforts to improve working capital," said Stephen Smith, Senior Vice President and Chief Financial Officer. "Our liquidity position remains healthy, and at the end of September 2020, our net debt to Adjusted EBITDA leverage ratio was 2.4x, down from 3.6x in the prior year period and improved from the prior sequential quarter.

Due to the uncertainty and ongoing impacts of COVID-19, we withdrew our full-year guidance earlier this year. At this time, we expect the fourth quarter earnings will drive our 2020 full year Adjusted EBITDA above our 2019 full year Adjusted EBITDA.

About Veritiv

Veritiv Corporation (NYSE: VRTV), headquartered in Atlanta and a Fortune 500® company, is a leading North American business-to-business distributor of packaging, facility solutions, print and publishing products and services. Additionally, Veritiv provides logistics and supply chain management solutions. Serving customers in a wide range of industries, Veritiv has distribution centers throughout the U.S., Canada and Mexico, and team members around the world helping shape the success of its customers. For more information about Veritiv and its business segments visit www.veritivcorp.com.