QUAD/GRAPHICS, INC. 17th Annual Midwest IDEAS Conference

Tony? Great. Thank you. Okay, safe harbor statements.

Everyone read. No, just kidding. Okay, we will move on. Quad started in 1971. Its current CEO is the second generation of the founder, Harry Quadracci, who started Quad/Graphics. That is where the Quad came from. So 55 years in business, $2.4 billion in revenues, 2,100 clients, 10,000 active employees, so an operation of some scale. We have been through transformation, as we get to this next slide. The company, again, started in 1971. Up through 2010 was a private company. Growth through organic, putting up printing plants in different locations, focus on magazines, retail inserts, i.e., coupons, and also catalogs, some direct mail. When we hit 2010, we did an acquisition of a company called World Color Press, or Quebecor, some may know it as. Through that acquisition, we went public through an S4 process.

Not a traditional S1, but a merger process that took us public. We did a couple other consolidating acquisitions. That was a time in the commercial printing industry where the choice was acquire or be acquired, and us and R.R. Donnelley were doing the acquiring. That leads us to 2018 when we started our journey towards being a marketing experience company. So handling all areas for the chief marketing officer. Still with a foundation in print, but also did other acquisitions such as, we acquired a creative agency called Periscope, now called Betty, in the lower right-hand corner there. Also acquired a digital agency here in Chicago called Rise Interactive, so that we would be able to offer all things to the chief marketing officer within one house. If we move on, that is what this slide shows, kind of articulates our offerings.

It all starts with data and intelligence. Julie will tell you about the amount of mail that we put into the postal stream. But through that, and then through some other third-party sources, we have a proprietary data stack that allows us to print the most efficiently and effectively, through targeting to individuals that receive our mail. The creative part of it in the pink circle, through the Betty agency, we have the ability to do creative. We still can do the production, the big print invoices, as well as digital TV ads. Also, search engine optimization, other digital campaigns, and we place that media in the right spot with our Rise Interactive offering.

If you compare us to a large advertising agency like an Omnicom or Publicis, they do not have the heavy iron, so they have to use a number of subcontractors to ultimately deliver an ad campaign. Or the ones who have heavy iron do not have the creative. We are the ones in the U.S. that have the full offering, all the way through creative, through design, through ultimately execution of the campaign. We do that for over 2,100 clients. A pretty nice who's who list of customers. Seeing Amazon in the upper left, people do not think of Amazon as a cataloger, but maybe some of you get the toy catalog for your children that Amazon puts out every year. Over 30 million catalogs go out from Amazon. They are a top five catalog producer in the U.S. People would not think that about Amazon. We do that printing. Kids can still go through, circle what they want, like they used to in the old days.

Parent can order through a QR code, so it connects an offline catalog piece with online digital ordering. Santa, i.e. Amazon, delivers the present, and you are all set for the Christmas season. AARP in the lower right, another very large customer of ours. Maybe some of you get AARP mailings. I do. We coordinate all of that mailing for them and print everything else. You can see we go across different consumer segments. With that, I am going to kick it over to Julie, and then I will come back up in a little bit. It does not look like our timer started. I do not know where we are at.

All right. I am going to pick up from the map here. You can see the map represents our manufacturing facilities in the U.S., with four of those being mega plants. I think we have to advance here. Go back one slide. Sorry about that. You can see the map here. Four of these are mega plants that have about 1.5 million square feet each. We are going to- Clicking backward pause for a second because the slides I'm going back.

Back. Yeah. You always have to look at this one.

I'll be the one on this one.

Yeah. Yeah. Yeah. All right.

Sorry about that. 20 plants located throughout the U.S., four of those being mega plants. Yeah, it does seem to want to be advancing itself.

Okay. I think we might have a technical I'm going to continue, and we'll see if you guys can help us figure out the slides.

What the map would highlight is that we have about 70% of the square footage that we own. 10 million sq ft of owned real estate, which we really believe is an advantage for us because, not only are we not at the whim of having to worry about lease costs escalating or not being able to stay in the space we want, these are assets that we can monetize as we rationalize our print platforms. As we look at capacity and consolidate, we often are able to free up capacity, and then we can use that asset value to either invest further in the business or pay down debt.