ACCO Brands raises sales growth outlook to 4%–6% and EPS outlook to $1.02
Key Facts
ACCO Brands raised its fiscal 2026 outlook, targeting reported sales growth of 4% to 6% and adjusted EPS of $0.98 to $1.02, management said on the third-quarter earnings call. The company said the revision reflects the combined impact of tariff refunds and the acquisition of Trust. Its July outlook had called for sales growth of 2% to 5% and EPS of $0.87 to $0.91. At the time, it also expected free cash flow of $75 million to $85 million. The higher outlook comes despite lower comparable sales in the quarter, as earnings benefited from tariff refunds and the addition of Trust to the company’s portfolio.
Net sales for the third quarter ended September 30 were $380.3 million, down 0.9% from $383.7 million a year earlier, while comparable sales fell 6.2%, according to the company’s statement. Management said weakness in technology accessories was the main driver of the decline. That impact was partly offset by growth from the EPOS acquisition and improved foreign exchange rates. The company also cited a strong back-to-school season in North America and Mexico, and stable trends in workplace solutions. These factors reflect a mixed picture, with core sales declining in some categories while acquisitions and currencies supported growth.
Adjusted EPS was $0.28 in the third quarter, compared with $0.21 in the corresponding period of 2025. The quarter’s result included a benefit of $0.11 per share from net tariff refunds. Management said the company received $21 million in cash from those refunds during the quarter. It added that the amounts lifted gross margin by 520 basis points and improved EPS by $0.11. The earnings statement showed that the refunds boosted consolidated operating income by $15.1 million and raised adjusted operating margin by 400 basis points. A portion of the quarterly earnings improvement was therefore directly tied to tariff refunds.
The acquisition of Trust closed on October 1, and the company generates approximately $100 million in annual revenue, management said. ACCO Brands expects the deal to have a modestly positive impact on adjusted EPS during the first 12 months after closing. The CEO said the transaction will expand the technology accessories portfolio to approximately $500 million in initial annual sales on a pro forma basis after the acquisition. The company identified brand integration and synergy realization as priorities after closing. The deal gives the company an additional revenue base in a segment where management said weak trends had weighed on quarterly sales.
Year-to-date free cash flow was $89 million through September 30, compared with $25.8 million in the first nine months of 2025, according to the earnings statement. The figure included $21.3 million from tariff refunds. Management said free cash flow increased by $63 million from the year-earlier period, including a $21 million benefit from the refunds. The company attributed the rest of the improvement to working capital management and spending discipline. Consolidated leverage was 3.6 times at the end of September, while the July outlook for full-year free cash flow was $75 million to $85 million.
ACCO shares closed at $4.36 on October 29, according to EL7 data. On shareholder returns, the company announced a quarterly cash dividend of $0.075 per share on October 23. The dividend is payable to shareholders of record on November 20, with payment scheduled for December 9, 2026. The dividend announcement was included in the third-quarter earnings statement. The payment date falls about three weeks after the specified record date.