Strictly Private and Confidential

Strategic Alternatives Discussion

R.R. Donnelley & Sons Company
May 4, 2015

Team Seven
Heather Jiang, Bryan Koch,, Jake Mattison, Austin Pritchett, Steve Tabor
Table of Contents

I. RR Donnelley Strategic Overview

II. Industry Overview

III. Potential U.S. M&A Candidates

IV. Proposal and Strategic Rationale

V. Transaction Rationale and Summary

VI. St Ives Group Overview

VII. Financial Highlights

VIII. St Ives Business Strategy

IX. Valuation – Accretion – Comps

Appendix

A. Consolidated Pro-Forma Financials

B. Comps

1
RR Donnelley Strategic Overview
Summary Financial Performance (1)
$Bn
RR Donnelley (“RRD”), is the leading North American commercial
printing and information services company. However, RRD must adapt to 15.0 20%
the changing environment by pivoting towards data analytics, content
optimization, and multi-channel marketing capabilities 11.6 11.6
12.0 10.6 16%
10.0 10.2 10.5
9.9
 EBITDA margins have steadily declined over the years and currently 15.4%
stand at a multi-year low 8.5% 9.0 12%
12.1% 12.0%
 Given RRD’s target leverage ratio of 2.25x – 2.75x on a long term 10.9%
basis, an extremely large M&A transaction would be unsuitable 9.4% 9.7%
6.0 8.5% 8%
 However, RRD can utilize the $1.3B credit facility or utilize stock to
fund a modest transformative transaction 3.0 4%
1.8
0.9 1.1 1.3 1.2 1.0 1.0
Our team has extensive experience with multinational transactions and
prior M&A experience in the Media, Marketing and Print space. We have
0.0 0%
identified an ideal candidate that operates in data, content optimization,
2008 2009 2010 2011 2012 2013 2014
book publishing and multi channel marketing
In 2011, this U.K. firm undertook a radical transformation to go from Revenue EBITDA EBITDA Margin (T12M)
commercial printing to multi-channel marketer
Leverage Overview (1)
We believe the employees, business lines, and client connections of this
firm would be invaluable to RRD $Bn
15.0x 5.0
U.K. takeover law is challenging, our U.K. takeover Managing Director

Thousands
4.3
Bruce Horton-Gabell, has decades of experience 4.1
11.8x 3.9
12.0x 3.5 3.7 3.6 4.0
Small/Midsize M&A is a better fit 10.2x 3.3 3.4

9.0x 2.6 7.7x 7.9x 3.0

Date Target Nam e Value Type EV/EBITDA Status 2.4
1/27/2015 Courier Corp $293.9 Cash or Stk 8.0x Pending 6.0x 5.2x 2.0
4.7x 4.6x
2/27/2014 Multicorpora R&D Inc 5.5 Cash - Done
3.8x 3.7x 3.4x
3.0x 2.3x 2.1x 1.0
1/6/2014 Operations of Esselte 96.5 Cash and Stk - Done 1.7x 1.5x 3.1x 2.8x 2.8x 2.8x 3.1x
2.4x
10/24/2013 Consolidated Graphics 690.8 Cash and Stk 6.1x Done
0.0x 0.0
5/22/2012 EDGAR Online Inc 36.5 Cash - Done
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
2/23/2010 RR Donnelley Financial 451.4 Cash 9.8x Done
5/13/2009 Quad/Graphics Canada $1,532.0 Cash and Stk - Term. Total Debt Net Debt/EBITDA EBITDA to Interest Expense
Average $443.8 8.0x
2 Source: Company Filings, Bloomberg
(1) Bloomberg, EBITDA is adjusted for 2012 Impairment Charge
Industry Overview
Key points within the industry Allocation of Advertising Budgets

There has been mass movement within the media and advertising 100%
5.8% 5.2% 4.5% 4.0% 3.5%
industry towards digital 8.6%
9.9% 9.6% 9.3% 8.9%
 Print media and advertising expected to continue to shrink year over 80% 9.2% 8.8% 8.4%
9.9% 9.6%
year for the foreseeable future, to be replaced with digital 9.3%
11.5% 10.2%
 Big data and analytics in advertising has been growing tremendously 14.8% 13.1%
60%
across the globe over the past four years and we expect that it will
continue to grow at a rapid rate 22.3% 25.2% 28.2%
17.1% 20.2%
 Spending on digital advertising has been growing at a steady pace as 40%
companies are able to better understand how to target their customers
through data and analytics tools
20% 38.4% 38.3% 39.1% 38.8% 38.1%

Businesses continue to struggle with understanding and utilizing big

data. RR Donnelly is ideally positioned to capitalize on this shift from 0%
traditional print to integrated data and marketing 2010 2011 2012 2013 2014

TV Digital Newspapers Magazines

Madio Directories Outdoor

Spending on Digital Advertising Global Big Data Market Size

$Bn $Bn
200 30 28.5
170.5
Services Other
160 146.4 24
121.5 18.7 18.4
120 104.6 18

80 12 11.7 12.5
7.3
7.3
40 6 4.5 10.1
4.4 6.2
0 2.8
0
2012 2013 2014 2015 2011 2012 2013 2014
3 Source: eMarketer via Statistica, Wikibon via Statistica
Potential U.S. M&A Candidates
Financial Data LTM Operating Statistics (1) Trading Multiple
Total TEV/Total TEV/
Equity LTM Total LTM Net Gross EBITDA EBIT NI NTM TEV/Fwd
Enterprise Revenues EBITDA
Value Revenue Debt Margin Margin Margin Margin Total Revenue
Value LTM LTM
Paycom Software 1,865.6 1,863.8 150.9 1.8 83.6% 14.6% 10.4% 3.7% 12.4x 84.9x 9.4x
Zendesk, Inc. 1,758.3 1,873.8 127.0 115.5 63.8% -46.9% -52.1% -53.0% 13.8x NM 9.3x
Box, Inc. 1,752.1 2,040.6 216.4 -288.6 78.2% -64.9% -76.7% -77.7% 8.1x NM 6.1x
Marketo, Inc. 1,153.7 1,251.0 163.7 -99.1 65.7% -31.9% -37.9% -36.6% 7.0x NM 5.1x
HubSpot, Inc. 1,138.2 1,261.7 115.9 -123.5 68.0% -40.4% -41.9% -41.6% 9.8x NM 7.0x
Constant Contact 706.1 885.2 343.2 -179.1 72.7% 11.8% 6.7% 4.9% 2.1x 18.9x 1.8x
Q2 Holdings, Inc. 676.3 764.6 79.1 -88.4 41.8% -18.9% -24.1% -24.8% 8.5x NM 6.4x
OPOWER, Inc. 384.4 509.0 128.4 -124.6 65.6% -29.7% -31.8% -32.5% 3.0x NM 2.6x
SciQuest, Inc. 312.6 440.0 102.5 -127.3 68.6% 4.6% -1.2% -0.4% 3.1x 60.7x 2.8x
Five9, Inc. 238.8 269.4 103.1 -30.6 47.0% -28.2% -34.5% -36.6% 2.3x NM 1.9x
Amber Road, Inc. 191.3 229.0 64.8 -37.8 57.6% -35.2% -39.8% -42.7% 3.0x NM 2.4x

Mean 925.2 1,035.2 145.0 -110.2 64.7% -24.1% -29.3% -30.6% 6.7x 54.9x 5.0x
Median 706.1 885.2 127.0 -115.5 65.0% -29.7% -34.5% -36.6% 7.0x 60.7x 5.1x

St Ives plc (LSE:SIV) 416.1 341.6 511.4 65.1 31% 15% 8.0% 1.3% 0.8x 5.2x 0.7x

Takeaway…Valuations are at an Extreme in the U.S.

 Despite it’s focus on data analytics, Paycom Software’s business line concentrates on cloud-based human capital management (HCM) software
solutions, with minimum extension in either printing or marketing segments, posing challenges in integration and realizing synergies
 HubSpot, Inc. provides a cloud-based inbound marketing and sales software platform for businesses globally, which fits into RRD’s transforming
strategy; when compared to SIV, acquiring HubSpot has several shortcomings:
– Acquiring HubSpot would require significant capital raising, either diluting current shareholder value or significantly increasing RRD leverage
– Extensive integration is required post-acquisition to improve HubSpot’s operation, postponing synergy realization
– 11% of FY2014 revenue was from outside of U.S., from Australia and Ireland only; lack of diversified geographic footprints and posts
challenge in integrating on a global platform
 Constant Contact provides online marketing tools that are designed for small organizations worldwide which excludes printing or medical industries,
posing challenges to transferring industry knowledge
 SciQuest’s cloud-based business solution focuses on internal optimization, such as spending management and contract lifecycle management, with no
business operation in marketing segment
 In general, U.S. candidates demonstrate less favorable operating statistics and higher trading multiples, less favorable compared to SIV
4 Source: Bloomberg, Capital IQ
(1) LTM Gross and EBITDA Margins are latest FY for SIV
Proposal and Strategic Rationale

 Strong market position fortified by
diversified product & service portfolios, but
margin remains flat in low growth industry
 Steady cash generation from printing
business can be used to fund acquisitions
with higher growth and margin
 Pursuing goal of 2.25x- 2.75x Leverage
due to low margins and high sensitivity to
macro economic environment
 Relationships with Fortune 500 provide
access to knowledge and data which can
be utilized in data analytics and marketing
services, capturing the fast growing digital
advertising and big data market
Without significantly raising leverage or
extending printing capacity, acquiring
SIV provides RRD with:
 A successful business
transformation model that is
applicable to the RRD U.S. and global
business
 An established full marketing service
platform that is readily restructurable
and scalable
 An experienced management,
marketing and consulting team
 Further fortified position in
commercial printing segment
 U.K. based printing company successfully
entered marketing consultancy in 2011
 Completed extensive restructuring activity
by divesting low margin printing divisions
and focused on becoming an integrated
communication company
 Possess data marketing solution and
consultancy platforms and teams; and
provide a full cycle of marketing service; all
can be scaled up
 Management successfully integrated
acquired businesses to deliver
collaboratively with established platform
both domestically and internationally

Why This U.K. Company UD $ / European Currency FX Rates

 Overlap in client base and SIV’s historical growth through acquisition
0.95
minimizes post-acquisition integration
USD/EURO USD/GBP
 Suitable candidates in U.S. are overvalued or require RRD to raise
0.85
significant amount of debt to fund a potential acquisition, SIV is a
manageable mid-sized acquisition target
0.75
 Given its strong position in commercial printing in U.S., the international
market provides more space for growth and diversification; meanwhile, U.K.
market echoes with U.S. enough so the industry experience can be easily 0.65
transferred
 Favorable tax treatment due to U.K. 21% rate. Should management wish 0.55
headquarters and non-fixed assets can move to the U.K. in a tax inversion
 The current USD/GBP exchange rate provides for a favorable cross border 0.45
M&A environment Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15

St Ives’ $419m in 2015E Marketing Sales will be valued at 3-6X: adding greater than $1bn in value to RRD

5 Source: Company filings, Capital IQ

Transaction Rationale and Summary
Deal Headlines LTM Stock Performance
With a lack of suitably valued U.S. targets operating in data, ecommerce and
Deal Value: $519.3m direct marketing, SIV provides RRD the opportunity to enter into a fast
growing and premium margin business. Wall Street currently places extreme
value on business operating in the marketing and big data space
Deal Announced: 5/15/15
 With $419m in 2015E sales derived from data and marketing, Wall Street
Nature of Bid: Friendly will place a value of 3x - 6x sales on this line of business
 With access to a deeper pool of capital, the SIV business units can
Premium: 30% meaningfully accelerate top line revenue growth, this translates to a new
growth story to show analyst
Price Per Share: $3.46 EU markets have traded down based on EU debt and currency concerns,
100% Stock Floating Exchange Ratio now is an ideal time to diversify internationally and get in at the bottom of the
Consideration: 0.1855 exchange ratio at Announce cycle
The U.S. Dollar is currently strong vs. the GBP, making this an even more
Accretion 5.9% FY15 5.0% FY16 attractive time to pursue M&A in Europe
British tax law prescribes an effective tax rate of 21%, far below the U.S.
Estimated Synergies: $25m cost synergies Federal rate, RRD can conduct operations through the UK to reduce tax
expense

Transaction Multiples SIV Valuation Range

Equity Value (30% Premium) $447.4m

DCF
DCF $405 $548
Enterprise Value: $519.3m
EV/2015E EBITDA $450 $500
Transaction

FY15E Revenue: $531.5m

EV/LTM EBITDA $465 $557

FY15E EBITDA: $67.6m EV/2015E Sales $304 $450

TV/LTM EBITDA $535 $635

Trading

FD Shares: 129.4M
TV/LTM Sales $387 $487
EV/ 2015E Revenue: 0.7x
$250 $300 $350 $400 $450 $500 $550 $600 $650
EV/ 2015E EBITDA: 4.9x SIV EV: $519.3m
6
St Ives Group Overview
Summary Financial Performance (1)
Headquarters One Tudor Street, London $m Except Per Share Projection Period
2012 2013 2014 2015E 2016E 2017E
Founding 1964 as a Print Business
Sales 520.6 496.1 538.5 581.6 631.0 684.7
IPO SIV 1985 on the LSE % Growth 9.8% -4.7% 8.5% 8.0% 8.5% 8.5%
EBITDA 59.0 72.9 79.7 85.5 94.0 103.4
Employees 2,943
% Margin 11.3% 14.7% 14.8% 14.7% 14.9% 15.1%

Customers Recently added Johnson & Johnson and HSBC CAPEX 9.7 9.2 16.8 11.6 12.6 13.7
Burberry, BT, Google, Lloyds, Unilever, Coca- % Sales 1.9% 1.9% 3.1% 2.0% 2.0% 2.0%
Cola, Lexus, Chanel, Lego, Levi, Calvin Klein
Share Price $ 2.66 FY15E

Geographic Mix Over 25% of Marketing revenue is derived from Fully Dil Shares (m) 129.4 Revenue 581.6 0.7x
outside U.K., firm continues to focus Equity Value 344.2 EBITDA 85.5 4.9x
increasingly on international organic growth and Plus: Debt 92.6 FY16E
acquisitions Less: Cash -20.8 Revenue 631.0 0.7x
Fully Diluted EV $416.1 EBITDA 94.0 4.4x
Product Offering Strategic Marketing – Provides Data for “data
driven direct marketing”
Digital services for ecommerce, online search (2)
and digital marketing
52 Week Trading Overview
Consulting services provide consumer insight
120
and market research for retail, consumer and
healthcare markets St Ives MSCI Europe Index
110
Marketing Activation – Provides Marketing
print services for point of sale retail
communications 100
Print Management and high impact visual 95

communications. 90 88
Field Marketing provides clients with services to
raise customer awareness in store and drive
sales 80

Books – Market leader in Monochrome

production, multi year agreement with Penguin 70
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr
Random House
7 Source: Company Website and 2015 Interim Report
(1) Bloomberg
(2) CapIQ
Financial Highlights
Historical Revenues Historical EBITDA
St Ives Group (“SIV”), is an international marketing services group. $m
Together, the Group’s businesses serve leading brands internationally,
100.0 94.0
with offices in the UK, North America, China and Singapore
85.5
 Industries of focus include retail & consumer products, healthcare & 80.4
79.7
pharmaceutical, financial services, media, technology, automotive and 80.0 72.9
charity
 Since 2011, SIV has focused on shifting from a pure play printing 59.0
company to a data and marketing services group 60.0 55.8
50.8
 The shift in strategy has resulted in a 11.1% EBITDA CAGR over the
last 4 years
40.0
Management has successfully grown the business over the past five
years by pursuing a combination of organic growth and bolt on
acquisitions. Each acquired business seeks to complement and not 20.0
compete with existing SIV business units
 Recent acquisitions have included:
0.0
May 2015 - The Hive Group (Healthcare Consulting, $31.7m)
2010 2011 2012 2013 2014 LTM 2015E 2016E
March 2015 - Solstice Consulting LLC (Mobile solutions $37.4m)
Historical Margins Revenue Mix
40% Strategic Marketing
Gross Margin
10% Segment 29%
EBITDA Margin 31%
30% 28% 28% 29% 21%
27% 26% Data
10%
22%
2% Digital
20%
15% 15% 15% 9% Consulting
12% 11%
11%
10% 8% Marketing Print

Field Marketing
48%
0% Books
2008 2009 2010 2011 2012 2013 2014
8 Source: Research, St Ives 2014 Annual Report and Bloomberg
St Ives Business Strategy Overview
 SIV’s successful implementation of the strategy outlined below can be applied by RR
Donnelley (“RRD”) to successfully expand into direct marketing and data services
 SIV is already expanding to the United States, RRD can leverage existing U.S. relationships to
drive growth even further 2015 Interim % Group
Revenue Revenue
 Existing management team and all employees of SIV will prove valuable in transitioning RRD
to a premier data driven international marketing services group
Data $25.2m 10%

Strategic Marketing
Group Businesses: International
 Operate as Provides investment Digital $27.0m 10%
Marketing Services
Individual Brands and U.S. Leadership
Group made up of
 Complement One to accelerate growth
individual market
Another leading businesses
 Foster a Common Supports Consulting $24.3m 9%
Culture Collaboration

Marketing Activation
The St Ives Strategy Marketing Print $125.6m 48%
Is Centered Around Three Key Priorities…

Field Marketing $7.2m 2%

Collaboration Internationalism Acquisitions Books $54.8m 21%

Shanghai office for

Approach is based on Incite, the consumer Acquire
cross-thinking and market research complementary,
consultancy ambitious and growing
Over 90% of our clients Strategic Marketing
work with more than one Greater than 25% of Businesses
business across the group Marketing Revenue from
Outside the UK

9 Source: St Ives 2014 Annual Report and Bloomberg

Synergies
St Ives has made the transition RRD is attempting Cost and Revenue Synergies

St Ives has spent the last 6 years reinventing itself from a sleeping
printing company to an integrated communication firm.
We now have a profitable cash-generative Print Services
business, and a substantial Marketing Services proposition
which has been successfully expanded and strengthened
through acquisition over the past year.“
"Our Strategy since 2009 has been to restructure our print
business while repositioning the group so that it can take
advantage of new growth markets within the services markets
within the marketing services sector“
-Richard Stidwell
St Ives Chairman
We anticipate $90m is total synergies arising from the transaction
$25m in cost synergies
$65m in revenue synergies
This transaction will extend the product suite for R.R. Donnelly into the
faster growing sectors of consulting, digital marketing and data driven
marketing
• The additional products will enable R.R. Donnelly to capitalize their
existing strong relationships within large U.S. corporate clients
• The marketing segment within St Ives is growing at over 12% annually
• St Ives management has experience in turning around a printing firm
• St. Ives has a proven track record of acquiring companies in the
growing arena of digital marketing products

The St Ives Capabilities that RRD can invest in Combined Product Mix
Data Marketing Consulting Services Combined

 Automated Marketing  Strategic Branding and Logistics $1,160 $1,160

Management Tools Marketing Strategy Financial 1044 1044
 CRM Consulting  Consumer Insights Sourcing 232 232
 Consumer Insight Consulting  Retail & Consumer Markets
Creative & Marketing 232 148 380
 Data Capture, Cleansing, Consultancy
Management and Analysis  Healthcare strategic consulting Marketing Printing 580 245 825
Trad. Printing 3270 3270
Digital Marketing Field Marketing
Office Products 580 580
 Full Service Digital Marketing  Field and Sales Marketing
 Strategic and Creative Services  POS and Exhibition Labels 464 464
 Campaign Design and Build Statement Printing 348 348
 Ecommerce Consulting Forms 232 232
 Online Marketing
Books 841 103 943.5
 Marketing Campaign
Management Directories 144 144
 Media Sales Total $9,127 $496 $9,623
10 Source: Research, St Ives 2014 Annual Report and Bloomberg
Accretion / Dilution
30% Premium to Last Close
Sensitivity Impact to Combined EPS – 2015 (100% Cash) Accretion Dilution (100% Stock)
 Assumes a 7.32% cost of cash based on RRD WACC Target@ Deal Price Target Aquirer
Diluted Shares 129.4m 129.4m 201.8m
EPS $1.00 $1.25 $1.56 $1.87 $2.25 $2.70 Price [USD] $3.45 $2.66 $18.62
Equity Value (in M USD) 447.4 344.2 3,757.5
15.4% -31.6% -15.6% 4.4% 24.4% 48.4% 77.2% Enterprise Value (in M USD) 519.3 416.0 6,888.7
PE - Multiple
19.2% -31.9% -15.9% 4.1% 24.1% 48.1% 76.9%
EPS $1.00 $1.25 $1.56 $1.87 $2.25 $2.70 EV/EBITDA
Premium

24.0% -32.2% -16.2% 3.8% 23.8% 47.8% 76.6% CY 2015E 8.8x 4.9x 5.7x
15.4% -31.6% -15.6% 4.4% 24.4% 48.4% 77.2%
30.0% -32.6% -16.6% 3.4% 23.4% 47.4% 76.2%
19.2% -31.9% -15.9% 4.1% 24.1% 48.1% 76.9% Pro Forma Acquirer Target Aquirer
36.0% -33.0% -17.0% 3.0% 23.0% 47.0% 75.8% Diluted EPS Accretion
Premium

24.0% -32.2% -16.2% 3.8% 23.8% 47.8% 76.6% CY 2015E [US$] +5.9% 1.65 0.29 1.56
43.2% -33.4% -17.4% 2.6% 22.6% 46.6% 75.4% P/E to Achieve Share Price 11.5x 9.1x 11.9x
30.0% -32.6% -16.6% 3.4% 23.4% 47.4% 76.2%
51.8% -34.0% -18.0% 2.0% 22.0% 46.0% 74.8% Add'l Synergies to break even -25.2
36.0% -33.0% -17.0% 3.0% 23.0% 47.0% 75.8% CY 2016E [US$] +5.0% 1.80 0.31 1.73
P/E to Achieve Share Price 10.4x 8.5x 10.8x
43.2% -33.4% -17.4% 2.6% 22.6% 46.6% 75.4%
Add'l Synergies to break even -23.7
51.8% -34.0% -18.0% 2.0% 22.0% 46.0% 74.8% (Net Debt/TTM EBITDA) -0.3x 2.9x -0.2x 3.1x
EPS $1.00 $1.25 $1.56 $1.87 $2.25 $2.70
Sensitivity
15.4% Impact
-31.3% to Combined
-15.4% EPS – 2016
4.6% 24.6%(100%
48.6%Cash)
77.3% Offer Premium
240
19.2% -31.6% -15.6% 4.4% 24.4% 48.3% 77.1%
EPS $1.00 $1.25 $1.56 $1.87 $2.25 $2.70
Premium

24.0% -31.8% -15.9% 4.1% 24.1% 48.1% 76.8% 220

15.4% -31.3% -15.4% 4.6% 24.6% 48.6% 77.3% 16% premium over
30.0% -32.2% -16.2% 3.8% 23.7% 47.7% 76.5%
19.2% -31.6% -15.6% 4.4% 24.4% 48.3% 77.1% 52W VWAP
200
36.0% -32.6% -16.6% 3.4% 23.4% 47.4% 76.1%
Premium

24.0% -31.8% -15.9% 4.1% 24.1% 48.1% 76.8%

43.2% -33.0% -17.0% 3.0% 23.0% 46.9% 75.7%
30.0% -32.2% -16.2% 3.8% 23.7% 47.7% 76.5% 180
51.8% -33.5% -17.5% 2.5% 22.4% 46.4% 75.2%
36.0% -32.6% -16.6% 3.4% 23.4% 47.4% 76.1%
160
43.2% -33.0% -17.0% 3.0% 23.0% 46.9% 75.7%
51.8% -33.5% -17.5% 2.5% 22.4% 46.4% 75.2% 140
May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

Target Price Current Offer Price 52W High

52W Average 20d Average 20 Day VWAP

11
Trading Statistics of Selected Companies

Graphics Data , Marketing Oriented Commercial / Industrial Print Oriented Other

Enterprise Value

$7,306.1 $6,899.5
7,500
6,000
4,500
$2,480.2
3,000
$1,051.1
1,500 $323.4 $268.5 $233.0 $65.4 $11.1
-
Dai Nippon RR DONNELLEY Quad Graphics De La Rue PLC ST. IVES PLC Elanders AB-B Communis PLC F.E. Bording A/S GrafenIi PLC
Printing LTD & SONS CO Inc SHS

$1,140.0
LTM EBITDA

1250 $989.9
1000
750
$477.7
500
$168.8
250 $80.4 $48.2 $41.3 $9.3 $4.3
0
Dai Nippon RR DONNELLEY Quad Graphics Inc De La Rue PLC ST. IVES PLC Elanders AB-B Communis PLC F.E. Bording A/S GrafenIi PLC
Printing LTD & SONS CO SHS
EV / NTM EBITDA

7.5x 7.1x
8.0x 6.3x
5.7x 5.5x 5.3x
6.0x 4.9x 4.8x
4.0x 2.7x
2.0x
0.0x
(1)
De La Rue PLC Dai Nippon F.E. Bording A/S RR DONNELLEY ST. IVES PLC Elanders AB-B Communis PLC Quad Graphics Inc GrafenIi PLC
Printing LTD & SONS CO SHS
1 Yr. Rev Growth

100%
75%
50%
25%
0%
-25%
Elanders AB-B Communis PLC F.E. Bording A/S RR DONNELLEY ST. IVES PLC De La Rue PLC Quad Graphics Inc Dai Nippon GrafenIi PLC
SHS & SONS CO Printing LTD

12 Source: Bloomberg
(1) 5.5x multiple is high based on low EBITDA estimates per 3rd party equity research
 Appendix
Pro-Forma Financial Statements
Comps

13
A. Consolidated Balance Sheet

Standalone
SIV LN Equity RRD US Equity Adjustments Pro Forma
2015:S1 2014:Q4 + - 2014:Q4
Cash and Cash Equivalents 18.1 527.9 - 546.0
Short-Term Investments - - -
Accounts Receivable 115.3 2,033.8 2,149.1
Inventories 8.7 586.2 594.9
Prepaids and Other Current Assets 0.0 225.4 225.4
Total Current Assets 142.1 3,373.3 3,515.4

Property, Plant and Equipment, net 71.7 1,515.5 - 1,587.2

Long-Term Investment & Long-Term Receivables - - -
Goodwill 186.5 1,706.6 534.2 -186.5 2,240.8
Other Intangible Assets 58.7 423.7 - 482.4
Other Assets 0.6 620.2 620.8
Deferred Financing Fees - -
Total Assets 459.6 7,639.3 8,446.6

Accounts Payable 107.4 1,296.6 1,404.0

Short-Term borrowings 0.0 203.4 203.4
Other Current Liabilities 111.9 867.3 979.2
Total Current Liabilities 219.4 2,367.3 2,586.7

Revolver 446.8 446.8

Long-Term Borrowings - 3,429.1 3,429.1
Other Long-Term Liabilities 56.5 1,222.5 1,279.0
Total Liabilities 275.8 7,018.9 7,741.5

Total preferred equity - - -

Noncontrolling Interest - 26.6 26.6
Shareholders' Equity 99.1 3,365.2 - -99.1 3,365.2
Retained earnings & Other Equity 84.7 -2,771.4 -2,686.7
Total Shareholders' Equity 183.7 620.4 705.1

Total Liabilities and Equity 459.6 7,639.3 8,446.6

14 Source: Bloomberg
A. Consolidated Condensed Income Statement

LTM CY 2015E CY 2016E

SIV RRD Combined SIV RRD Combined SIV RRD Combined

Sales 552.6 11,603.4 12,156.0 532.6 11,725.8 12,258.3 542.8 11,911.8 12,454.6
% growth NA NA NA -3.6% 1.1% 0.8% 1.9% 1.6% 1.6%
COGS 369.3 9,052.8 9,422.1 - 2,579.7 - - 2,626.5 -
% sales 66.8% 78.0% 77.5% - 22.0% - - 22.1% -
Gross Profit 183.3 2,550.6 2,733.9 - 9,146.1 - - 9,285.2 -
% margin 33.2% 22.0% 22.5% - 78.0% - - 78.0% -
EBITDA 80.4 989.9 1,070.3 63.2 1,204.3 1,267.5 69.8 1,222.0 1,291.8
EBITDA Unadjusted 80.4 989.9 63.2 1,204.3 69.8 1,222.0
- - -
% margin 14.5% 8.5% 8.8% 11.9% 10.3% 10.3% 12.9% 10.3% 10.4%
EBIT 55.4 515.9 571.3 51.6 737.5 789.1 54.0 759.5 813.5
% margin 10.0% 4.4% 4.7% 9.7% 6.3% 6.4% 9.9% 6.4% 6.5%
Net Income 7.6 245.1 225.8 37.6 314.8 325.6 40.4 348.7 362.2
% margin 1.4% 2.1% 1.9% 7.1% 2.7% 2.7% 7.4% 2.9% 2.9%

15 Source: Bloomberg
B. Comparable Company
Comparable Company Selection

Operating Statistics Overview

Market Valuation LTM Financial Statistics LTM Profitability Margins Growth

Gross Net Sales EBITDA
Equity Enterprise Gross Net Profit EBITDA EBIT Income Hist. Hist.
Company Ticker Value Value Sales Profit EBITDA EBIT Income (%) (%) (%) (%) 5Yr CAGR 5Yr CAGR
St Ives plc SIV $ 357.0 $ 428.8 $ 552.6 $ 183.3 $ 80.4 $ 68.1 $ 7.3 33.2% 14.5% 12.3% 1.3% 3.0% 18.7%
Quad/Graphics QUAD 1,086.9 2,480.7 4,862.4 645.4 545.0 208.6 18.3 13.3% 11.2% 4.3% 0.4% 22.1% 11.9%
Chime Communications CHW 462.1 545.4 642.8 329.6 47.1 31.4 15.6 51.3% 7.3% 4.9% 2.4% 5.3% 5.4%
Elanders AB ELAN-B 157.1 266.7 532.3 115.0 44.3 27.9 13.6 21.6% 8.3% 5.2% 2.6% 17.9% 12.3%
Communisis CMS 185.9 241.8 564.8 92.5 43.7 24.7 (24.9) 16.4% 7.7% 4.4% -4.4% 12.5% 10.1%
Mean 25.6% 8.6% 4.7% 0.2% 14.5% 9.9%
Median 19.0% 8.0% 4.6% 1.4% 15.2% 11.0%

16 Source: Bloomberg; FactSet; company filings

B. Comparable Company Valuation
General Return on Investment Leverage Ratios LTM Coverage Ratios
Implied Net Debt / Net Debt / EBITDA / EBIT /
Company Ticker FYE Beta ROIC ROE ROA Div. Yield EBITDA (EBITDA - CapEx) Int. Exp. Int. Exp.
St Ives plc SIV Jun-30 0.36 3.1% 3.4% 1.6% 4.1% 1.0x 1.2x 21.2x 13.5x

Quad/Graphics QUAD Dec-31 1.16 0.7% 1.5% 0.4% 5.2% 2.6x 3.4x 5.9x 2.3x
Chime Communications CHW Dec-31 1.01 3.8% 5.1% 2.5% 3.0% 1.9x 2.3x 9.1x 6.1x
Elanders AB ELAN-B Dec-31 0.88 5.9% 8.0% 2.9% 2.4% 3.0x 3.4x 8.2x 5.1x
Communisis CMS Jun-30 0.67 -8.4% -11.8% -5.2% 4.0% 1.4x 3.1x 11.0x 6.2x
Mean 0.93 0.5% 0.7% 0.2% 3.6% 2.2x 3.1x 8.5x 4.9x
Median 0.95 2.2% 3.3% 1.5% 3.5% 2.2x 3.2x 8.6x 5.6x

Current % of Enterprise Value / LTM Total Price /

Share 52-wk. Equity Enterprise LTM 2015E LTM 2015E LTM 2015E EBITDA Debt / LTM 2015E
Company Ticker Price High Value Value Sales Sales EBITDA EBITDA EBIT EBIT Margin EBITDA EPS EPS
St Ives plc SIV $ 2.64 68.8% $ 344.2 $ 416.1 0.8x 0.7x 6.3x 4.9x 9.8x 5.9x 12.4% 0.0% 44.0x 14.7x

Quad/Graphics QUAD 22.27 92.3% 1,086.9 2,480.7 0.5x 0.5x 4.6x 4.8x 11.9x 12.5x 11.2% 2.5% 58.6x 16.3x
Chime Communications CHW 4.61 71.8% 462.1 545.4 0.7x 1.6x 11.6x 8.1x 17.4x 8.9x 7.3% 2.6% 30.7x 11.8x
Elanders AB ELAN-B 5.92 85.4% 157.1 266.7 0.5x 0.5x 6.0x 5.5x 9.6x 8.1x 8.3% 8.0% 13.2x 8.5x
Communisis CMS 0.90 76.9% 185.9 241.8 0.4x 0.4x 5.5x 5.0x 9.8x 7.8x 7.7% 2.3% 12.9x 9.0x
Mean 0.5x 0.8x 6.9x 5.8x 12.2x 9.3x 8.6% 3.8% 28.8x 11.4x
Median 0.5x 0.5x 5.8x 5.3x 10.8x 8.5x 8.0% 2.5% 21.9x 10.4x

Implied Enterprise Value

Multiples
Enterprise Value / Price /  EV/2015E Sales, EV/LTM EBITDA and EV/2015E
LTM 2015E LTM 2015E LTM 2015E LTM 2015E EBITDA are given extra weight in valuating SIV, given
Sales Sales EBITDA EBITDA EBIT EBIT EPS EPS
that:
– SIV’s business transformation has radically
Mean 0.5x 0.8x 6.9x 5.8x 12.2x 9.3x 28.8x 11.4x
altered margins, the growth profile and nature
Median 0.5x 0.5x 5.8x 5.3x 10.8x 8.5x 21.9x 10.4x of the business
– SIV has much higher EBIT margin that
Implied Enterprise Value comparable companies
Low 279.4 281.6 464.8 450.0 738.1 615.0 178.0 253.4
High 298.2 417.0 556.6 499.5 827.5 673.5 234.0 277.1

17 Source: Bloomberg; FactSet; company filings