ITEM 1. BUSINESS
As used in this Annual Report on Form 10-K for the fiscal year ended December 31, 2024, the terms "ACCO Brands," "ACCO," the "Company," "we," "us," and "our" refer to ACCO Brands Corporation, a Delaware corporation incorporated in 2005, and its consolidated domestic and international subsidiaries.
For a description of certain factors that may have had, or may in the future have, a significant impact on our business, results of operations or financial condition, see "Part I, Item 1A. Risk Factors" of this report.
Overview of the Company
ACCO Brands is a leading global consumer, technology and business branded products company, providing well-known brands and innovative product solutions used in schools, homes and at work. Approximately 75 percent of our 2024 net sales came from brands that are in the No. 1 or No. 2 position in the product categories in which we compete. Our top 12 brands represented approximately $1.3 billion of our 2024 net sales. Our products are sold primarily in the U.S., Europe, Australia, Canada, Brazil and Mexico.
Note: Artline® in Australia/N.Z. only
Business Strategy
Our key strategic priorities are to:
•Focus on improving our innovation and new product development processes, expanding into new points of distribution and extending our product offering into adjacent categories.
•Use our strong brand recognition and supply chain expertise to expand relationships with new and existing customers.
•Manage mature product categories which remain important profit and cash generators.
•Support profitability through margin expansion initiatives and our multi-year cost reduction and footprint rationalization programs.
•Maintain a balanced capital allocation strategy, which prioritizes debt reduction with our consistent cash flow to strengthen our balance sheet, while also supporting the quarterly dividend, potential share repurchases and opportunistic M&A.
•Execute a disciplined acquisition approach focused on expanding brand presence, extending our geographic reach and complementing existing product lines, while maintaining a low leverage ratio and realizing synergies.
The Company generates consistent operating cash flow, allowing for a balanced capital allocation strategy. Our capital allocation strategy includes investment to support internal capital projects to support our long-term growth, funding our quarterly dividend, share repurchases, debt reduction and potential acquisitions. Historically we have made acquisitions that have meaningfully expanded our portfolio of well-known brands, enhanced our competitive position from both a product and channel perspective, added scale to our operations and increased our geographic presence.
Operating Segments
ACCO Brands has two operating segments based in different geographic regions: Americas and International. Each operating segment designs, markets, sources, manufactures and sells recognized consumer, technology and business branded products used in schools, homes and at work. Product designs are tailored to end-user preferences in each geographic region, and where possible, leverage common engineering, design and sourcing.
Sales Percentage by Operating Segment 2024 2023 2022
ACCO Brands Americas 60% 62% 62%
ACCO Brands International 40% 38% 38%
100% 100% 100%
For more information on our operating segments see "Note 17. Information on Operating Segments" to the consolidated financial statements contained in Part II, Item 8. of this report.
Effective January 1, 2024, the Company reorganized into two operating segments, the Americas and International. Americas includes the U.S., Canada, Brazil, Mexico and Chile and International includes EMEA, Australia, New Zealand and Asia. This reorganization has and will continue to simplify and delayer the Company's operating structure and is continuing to reduce costs through headcount reductions, supply change optimization, global footprint rationalization, and better leverage of our sourcing capabilities. Prior period results have been reclassified to reflect this change in our operating segments.
Seasonality
Sales of the Company's products tend to be seasonal, with first quarter sales and operating income being lower than any other quarter. This is due to a combination of factors including lower volume and the mix of products sold in the first quarter. In addition, in the Americas, the U.S. back-to-school season primarily falls in the second and third quarters, which impacts our seasonality. The seasonality of the Company's sales volume combined with our fixed costs, such as depreciation, amortization, rent, personnel costs and interest expense, impacts the Company's profits on a quarterly basis.
Generally, our operating cash flow is generated in the second half of the year, as the cash inflows in the first and second quarters are consumed building working capital and making our annual performance-based compensation payments when earned. Our third and fourth quarter cash flows come from completing the working capital cycle. The seasonality of our operating cash flow maybe impacted as we execute on our footprint rationalization program and increase our use of sourcing finished products.
For further information on the seasonality of our net sales, earnings and cash flow, see "Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations"
Customers
We distribute our products through a wide variety of channels to ensure that our products are readily and conveniently available for purchase by consumers and other end-users, wherever they prefer to shop. These channels include mass retailers, e-tailers, discount, drug/grocery and variety chains, warehouse clubs, hardware and specialty stores, independent office product dealers, office superstores, wholesalers, contract stationers, and specialist technology businesses. We also sell directly through e-commerce sites and our direct sales organization.
Competition
We operate in a highly competitive environment. ACCO Brands competes with numerous branded consumer and business products manufacturers, as well as many private label suppliers and importers, including various customers who import their own private label products directly from foreign sources.
The Company meets competitive challenges by creating and maintaining leading brands and differentiated products that deliver superior value, performance, and benefits to consumers and other end-users. Our products are sold through diverse distribution channels. We further meet consumer and end-user needs by developing, producing, and procuring products at a competitive cost, enabling them to be sold at attractive selling prices. We also believe that our experience and skill in managing complex assortments and large seasonal demand is a competitive advantage, as are our strong relationships with technology and content providers in our technology accessories categories.
Product Development
We seek opportunities to invest in new products and adjacencies. Our innovation efforts focus on generating new, exciting, and differentiated products that meet consumer and other end-user needs and provide the opportunity to meaningfully grow sales and margins. Our commitment to understanding our consumers and end-users and designing products that fulfill their needs drives our product development strategy, which we believe will continue to be a key contributor to our success. Our products are developed by our internal research and development teams and with technology providers. Costs related to product development when paid directly by ACCO Brands are included in selling, general and administrative expenses.
Marketing and Demand Generation
We support our brands with a significant investment in targeted marketing and advertising, including on-shelf and in-store, and through digital and social media and consumer promotions that increase brand awareness, drive conversion, and highlight the innovation and differentiation of our products. We work with third-party vendors, such as Nielsen, Circana, GfK SE, NEWZOO and Kantar Group, to capture and analyze consumer buying habits and product trends.
Supply Chain
We have built a customer-focused business model with a flexible supply chain to ensure that we are able to supply our customers with value-added, high-quality products at an attractive price. We currently manufacture approximately 40 percent of our products in our own facilities located in the countries where we operate and source the remaining 60 percent from lower cost countries, primarily in Asia. Using a combination of our own manufacturing and third-party sourcing also enables us to reduce costs and effectively manage our production assets by lowering capital investment and working capital requirements. Under our global footprint rationalization program, we will continue to rationalize our facilities as well as look for opportunities to leverage our manufacturing facilities to improve operating efficiencies.
Intellectual Property
Our products are marketed under a variety of trademarks. Some of our more significant trademarks include ACCO®, AT-A-GLANCE®, Barrilito®, Derwent®, Esselte®, Five Star®, Foroni®, GBC®, Hilroy®, Kensington®, Leitz®, Marbig®, Mead®, NOBO®, PowerA®, Quartet®, Rapid®, Rexel®, Swingline®, and Tilibra®. We own rights to these trademarks in various countries throughout the world. We protect these trademarks as appropriate through registrations in the U.S. and other jurisdictions. Depending on the jurisdiction, trademarks are generally valid as long as they are in use or their registrations are properly maintained and they have not been found to have become generic. Registrations of trademarks can generally be renewed indefinitely as long as the trademarks are in use. We also own numerous patents worldwide. Additionally, our gaming accessories business depends on maintaining our licensing rights with key gaming console manufacturers and video game publishers.
Human Capital Resources
The people behind the brands are our greatest assets and key enablers of our success. We are intentional about providing fulfilling work experiences and competitive total rewards packages that attract top talent, motivate employees to stay and actively engage in a winning team environment.
At the end of 2024, we had approximately 5,000 full-time and part-time employees worldwide, with approximately 2,600 employees in our Americas operating segment (U.S., Canada, Brazil, Mexico and Chile), 2,300 in our International operating segment (EMEA, Australia and Asia) and 100 employees in Corporate. We also rely on a contingent hourly workforce to supplement our full-time workforce to meet seasonal demand. Approximately 200 manufacturing and distribution employees in the U.S. are covered by collective bargaining agreements. We also have government-mandated collective bargaining arrangements in certain countries, particularly in Europe and Brazil. There have been no strikes or material labor disputes at any of our facilities during the past five years.
Culture
Our core values include operating with integrity in all that we do, respecting the individual, embracing diverse perspectives and creativity to spark innovation, and acting responsibly in the communities where we live and work. Our culture helps to unlock each employee's sense of belonging and unique contributions, creating a culture where people bring their best ideas to the office and feel good about the work environment.
Talent Management and Training
Investing in people and growing talent, in the form of leadership development, supports business growth.
As we adapt to changes in business needs and priorities, addressing skill gaps and building, and sustaining, strong talent is critical to our success. Our people strategy includes a mix of developmental roles and learning experiences for our current employees as well as acquiring external talent to address new capabilities to help the organization accelerate growth. We also deliver Company-required learning to ensure compliance with our Code of Conduct and other important policies.
Employee Health and Safety ("EHS")
We are committed to Mission Zero— pursuing continuous improvement in health and safety within all our locations and to attain our goal of zero accidents and zero incidents. We have implemented our Comprehensive Environmental and Safety Management Plan as an overall management system for our manufacturing and distribution locations. Audits are completed by our teams to measure the proactive steps each location is taking to prevent injuries. We have been recognized as one of the safest companies in America and the U.K. on multiple occasions.
Community Involvement
We aim to give back to the communities where we live and work. Our corporate values include acting responsibly in our global communities through numerous employee volunteer and outreach initiatives. We encourage our employees to make a difference in our Company and in their communities by building on a fundamental commitment to responsibility. We support a wide range of charities worldwide, the most significant of which is the City of Hope, primarily based in the U.S. with far-reaching impacts of its medical and cancer-related research. The ACCO Brands and City of Hope partnership spans two decades.
Executive Leadership of the Company
As of February 21, 2025, the executive leadership team of the Company consisted of the following executive officers. Ages are as of December 31, 2024.
Patrick H. Buchenroth, age 57•2024 - present, Executive Vice President and President, Americas•2017 - 2023, Executive Vice President and President, ACCO Brands International•2013 - 2017, Senior Vice President and President, Emerging Markets•Joined the Company in 2002 Paul P. Daniel, age 59•2022 - present, Senior Vice President and Chief Information Officer•2020 - 2022, Vice President, Infrastructure and Operations•2017 - 2020 - Vice President, Global IT Operations, Tate & Lyle PLC •Joined the Company in 2020 James M. Dudek, Jr., age 53•2020 - present, Senior Vice President, Corporate Controller and Chief Accounting Officer•2017 - 2020, Vice President and Corporate Controller•2016 - 2017, Chief Accounting Officer, Innerworkings, Inc.•Joined the Company in 2017 Angela Jones, age 61•2020 - present, Senior Vice President and Global Chief People Officer•2018 - 2020, Senior Vice President and Chief People Officer, Compass Minerals•2016 - 2018, Vice President, Human Resources Rembrandt Foods•Joined the Company in 2020 Gregory J. McCormack, age 61•2024 - present - Senior Vice President, Global Operations and Supply Chain•2018 - 2023, Senior Vice President, Global Products and Operations•2013 - 2018, Senior Vice President, Global Products•Joined the Company in 1996 Cezary L. Monko, age 63•2024 - present, Executive Vice President and President, International•2017 - 2023, Executive Vice President and President, ACCO Brands EMEA•2014 - 2017, President and Chief Executive Officer, Esselte •Joined the Company in 1992 Deborah A. O'Connor, age 62•2022 - present, Executive Vice President and Chief Financial Officer•2020 - 2021, President and Chief Financial Officer, True Value Company•2015 - 2020, Senior Vice President and Chief Financial Officer, True Value Company •Joined the Company in 2022 Pamela R. Schneider, age 65•2012 - present, Senior Vice President, General Counsel and Secretary•2010 - 2012, General Counsel, Accertify, Inc.•Joined the Company in 2012 Thomas W. Tedford, age 54•2023 - present, President and Chief Executive Officer•2021 - 2023, President and Chief Operating Officer•2015 - 2021, Executive Vice President and President, ACCO Brands North America•Joined the Company in 2010