LSC COMMUNICATIONS. Quality. Reliability. Integrity. CJS Securities Conference. January 11, 2017

LSC COMMUNICATIONS Quality. Reliability. Integrity CJS Securities Conference January 11, 2017

LSC COMMUNICATIONS CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This presentation includes certain "forward-looking statements" within the meaning of, and subject to the safe harbor created by, Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the business, strategy and plans of LSC Communications and its expectations relating to future financial condition and performance. Statements that are not historical facts, including statements about LSC Communications management s beliefs and expectations, are forwardlooking statements. Words such as "believes," "anticipates," "estimates," "expects," "intends," "aims," "potential," "will," "would," "could," "considered," "likely," "estimate" and variations of these words and similar future or conditional expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. While LSC Communications believes these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond LSC Communications control. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend upon future circumstances that may or may not occur. Actual results may differ materially from LSC Communications current expectations depending upon a number of factors affecting the business and risks associated with the performance of the business. These factors include such risks and uncertainties detailed in LSC Communications information statement, dated September 23, 2016, filed as an exhibit to our Current Report filed on Form 8-K filed on September 23, 2016 and LSC Communications periodic filings with the SEC. LSC Communications does not undertake to and specifically declines any obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect future events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events. LSC COMMUNICATIONS 2

NON-GAAP FINANCIAL INFORMATION This presentation contains certain non-gaap measures. The Company believes that these non-gaap measures, such as non-gaap adjusted EBITDA, non-gaap net income and free cash flow, when presented in conjunction with comparable GAAP measures, provide useful information about the Company s operating results and liquidity and enhance the overall ability to assess the Company s financial performance. The Company uses these measures, together with other measures of performance under GAAP, to compare the relative performance of operations in planning, budgeting and reviewing the performance of its business. Non-GAAP adjusted EBITDA, non-gaap net income and free cash flow allow investors to make a more meaningful comparison between the Company s core business operating results over different periods of time. The Company believes that non-gaap adjusted EBITDA, non-gaap net income and free cash flow, when viewed with the Company s results under GAAP and the accompanying reconciliations, provides useful information about the Company s business without regard to potential distortions. By eliminating potential differences in results of operations between periods caused by factors such as depreciation and amortization methods, historic cost and age of assets, financing and capital structures, taxation positions or regimes, restructuring, impairment and other charges and gain or loss on certain equity investments and asset sales, the Company believes that non-gaap adjusted EBITDA and non-gaap net income can provide useful additional basis for comparing the current performance of the underlying operations being evaluated. By adjusting for the level of capital investment in operations, the Company believes that free cash flow can provide useful additional basis for understanding the Company s ability to generate cash after capital investment and provides a comparison to peers with differing capital intensity. LSC COMMUNICATIONS 3

COMPANY REPRESENTATIVES THOMAS J. QUINLAN III Chairman, Chief Executive Officer LSC Communications ANDREW B. COXHEAD Chief Financial Officer LSC Communications JANET M. HALPIN Senior Vice President, Treasurer and Investor Relations LSC Communications DAVID M. CLARK Senior Financial Analyst, Investor Relations LSC Communications LSC COMMUNICATIONS 4

AGENDA + LSC Communications Overview + 2017 Big Ideas for the New Year + Book Supply Chain Services Overview + Q&A + Appendix LSC COMMUNICATIONS 5

TRUSTED PARTNER We are the trusted print, fulfillment and supply chain solutions partner for publishers, retailers and merchandisers worldwide. Focused on print and related products, services and technology solutions. LSC COMMUNICATIONS 6

LSC COMMUNICATIONS: GROUNDED IN PRINT. FOCUSED ON REVOLUTIONIZING THE SUPPLY CHAIN BUSINESS OVERVIEW LSC Communications ( LSC or the Company ) is a worldwide leader in providing print, fulfillment and supply chain solutions to publishers, merchandisers and retailers SEGMENT OVERVIEW DIVERSE PRODUCTS & SERVICES CAPABILITIES ACROSS 2 SEGMENTS: PRINT AND OFFICE PRODUCTS Strategic Growth Opportunities Specializes in publishing and retail-centric print services, such as books, magazines, catalogs, inserts, and directories Manufactures and sells office products such as filing products, note-taking products, binders, tax and stock forms and envelopes Serves >3,000 publishers, merchandisers, catalogers and retailers globally, offering leaner and more flexible supply chain solutions to support operating efficiency LSC has 41 production facilities in the U.S and 12 international manufacturing facilities ~22,000 employees globally 14.1% Office Products 7.8% Europe 3.7% Directories $3.7B B 3Q 16 LTM sales 2015 sales 29.3% Books 45.1% Magazines, Catalogs, and Retail Inserts SELECTED CLIENTS Source: Company management and company filings. Note: 2015 net sales included $184mm from the acquisition of Courier, representing net sales from close date of 6/8/2015 to 12/31/2015. LSC COMMUNICATIONS 7

PRINT SEGMENT OVERVIEW KEY HIGHLIGHTS/STRATEGIES NET SALES ($mm) Print segment produces magazines, catalogs, retail inserts, books and directories and also provides certain print-related services, including mail-list management and sortation and e-book formatting and distribution with operations in US, Europe, and Mexico Serves > 3,000 publishers, merchandisers, catalogers and retailers globally, offering leaner and more flexible supply chain solutions to support operating efficiency Directories Offers a wide range of products and services to customers: Magazines: Magazine publishers who use the Company s capabilities to print and distribute magazines through the mail directly to subscribers and through wholesalers to retailers Catalogs: Retailers and other direct-to-buyer sellers who use the Company s production capabilities to print and distribute catalogs to customers through the mail Retail Inserts: Retailers who seek to include inserts in newspapers distributed to newspaper subscribers and in-store distribution Books: publishers who seek to print hardcover and softcover books, with soft or spiral binding serving the education, trade, religious and testing sectors 11.2% 10.1% 10.2% 10.3% Europe Book Magazines, catalogs, and retail inserts Non-GAAP Adj. EBITDA Margin Serves the top 10 book publishers in North America, along with 9 of the top 10 catalogers and magazine publishers in the U.S. Print represents ~86% of LSC Communications net sales (3Q 2016 LTM) Designing and executing innovative supply chain strategies to increase speed to market and improve efficiencies across the distribution process SELECT COMPETITORS Best-in-class, proprietary co-service solution leverages mail volume to offer our clients significant cost savings Note: Reconciliation of non-gaap financials in appendix. Source: Company management, Company filings, PwC Research and Technavio. LSC COMMUNICATIONS 8

OFFICE PRODUCTS SEGMENT OVERVIEW LSC customers in the office products segment include office superstores, mass merchandisers and contract stationers Offers a wide range of branded and private label products, primarily within the following five core categories Filing products Note-taking products Binder products Forms Envelopes KEY HIGHLIGHTS/STRATEGIES LSC has product placement at 9 of the top 10 retailers Top 5 supplies-vendor at both of the office supply superstores LSC services 5 of the top 10 ecommerce retailers Additional focus on ecommerce channel to capture market share with our premium branded products Office Products represents ~14% of LSC Communications net sales (3Q 2016 LTM) Further industry consolidation opportunities in Office Products Net Sales NET SALES ($mm) BRANDED PRODUCTS Non-GAAP Adj. EBITDA Margin Note: Reconciliation of non-gaap financials in appendix. Source: Company management, Company filings, PwC Research and Technavio. LSC COMMUNICATIONS 9

VALUE CREATION STRATEGY Grow core print and supply chain service offerings Continue operating excellence Deploy capital with discipline LSC COMMUNICATIONS 10

STRONG M&A TRACK RECORD Expanding Our Solutions and Services Offerings and Broadening Our Reach Go-forward M&A Criteria and Objectives Scale Von Hoffman (2007) Perry Judd s (2007) Poligrafia (2005) Office Products Esselte Corporation (NA operations) (2014) Cardinal Brands (2007) TOPS (2004) Enhance existing product offerings Expand technological capabilities Provide synergy opportunities Attractive financial return on investment Capabilities, Solutions and Technology Courier (2015) Pro Line Printing (2008) Banta (2007) Continuum (2016) We have a proven ability to strategically acquire, integrate and rationalize quickly in a fragmented market LSC COMMUNICATIONS 11

LSC FINANCIAL POLICY LEVERAGE AND LIQUIDITY Commitment to a conservative leverage target Continuing to target 1.75x to 2.25x gross leverage (1) 2.0x reported gross leverage (1) at September 30, 2016 Strong free cash flow (2) generation supports commitment to leverage target Combination of pre-payable and long term debt provides ability to efficiently pay down debt Supportive bank group with access to five year credit facility that provides for seasonal working capital needs and liquidity buffer PENSION PLANS CAPITAL EXPENDITURES US pension plans closed and frozen De-risking actions and liability driven investment structure reduces funded status volatility while minimizing required contributions Approximately 1.5% to 2.0% of net sales MERGERS AND ACQUISITIONS Selectively pursue strategic acquisitions Strategy governed by target leverage DIVIDEND POLICY Initial dividend of $0.25 per share Board of Directors to review dividend quarterly 1. Gross leverage defined as total debt / LTM non-gaap adjusted EBITDA 2. Free cash flow defined as net cash provided by operating activities less capital expenditures LSC COMMUNICATIONS 12

BIG IDEAS FOR THE NEW YEAR Developing new technologies, capabilities and solutions to better fit the needs of our evolving customer base: + Book Supply Chain Services + Expanding Digital Print Platform + Office Products e-commerce Strategy + Book Anti-Piracy Technology + Hi-Density Co-mail Services LSC COMMUNICATIONS 13

SUPPLY CHAIN SERVICES OVERVIEW SOLUTION OVERVIEW Our Supply Chain Services combine print, warehousing, fulfillment and supply chain management into a single workflow designed to increase speed to market and improve efficiencies across the distribution process Improve Total Cost of Ownership Reduce/ Eliminate Publisher s Fixed Costs Single Source of Supply Faster Speed to Market LSC COMMUNICATIONS 14

LSC S INDUSTRY LEADING SCALE AND UNIFIED PLATFORM ENABLE A FULL SERVICE OFFERING FOR BOOK PUBLISHERS Vendor Management Materials Manufacturing Book Fulfillment Services Order-to- Cash Logistics SUPPLY CHAIN SERVICES SERVICE OFFERING SCALE TRADITIONAL BOOK PRODUCTION SCALE 95 offset printing presses 80 binding lines 15 sheet-fed presses Extensive component, finishing, packaging, and logistics capabilities WAREHOUSING AND FULFILLMENT 3,800,000 square ft. of warehouses Full service offering includes: High volume storage Returns Kitting DIGITAL PRINT PLATFORM 9 billion pages of capacity Growing platform for quick-turn production Platform for short-run markets (self-publishing) LSC COMMUNICATIONS 15

CUSTOMER ENGAGEMENT TOP EDUCATION PUBLISHER BENEFITS OF THE TOTAL LSC SUPPLY CHAIN SOLUTION LSC has entered into an agreement with a leading company in education, business and consumer publishing, to provide complete supply chain management of 100% of this company s physical print products and other learning materials. Combines production, warehousing, fulfillment and supply chain management into a single workflow designed to increase speed to market, reduce costs and improve efficiencies across the distribution process. Client benefits + Significant savings on paper and procurement costs + Cash flow improvements + Quicker fulfillment rates to customers + Increase in titles available for sale + Reduce total payroll costs + Fewer out-of-stock products + Less inventory obsolescence + Reduction in warehouse space OFFSET PRINTING DIGITAL PRINTING E-SERVICES WAREHOUSING/ FULFILLMENT FREIGHT/ DISTRIBUTION LSC COMMUNICATIONS 16

Q&A LSC COMMUNICATIONS 17

APPENDIX LSC COMMUNICATIONS 18

NON-GAAP FINANCIAL MEASURES ($ millions) Total LSC Communications Q1 Q1 2016 Q2 Q2 YTD Q2 2016 Q3 Q3 YTD Q4 Q3 2016 2015 2014 2013 2016 2015 LTM 2016 2015 2016 2015 LTM 2016 2015 2016 2015 2015 LTM Net sales $3,742.9 $3,853.4 $3,741.0 $880.0 $860.9 $3,762.0 $906.1 $879.0 $1,786.1 $1,739.9 $3,789.1 $948.5 $999.0 $2,734.6 $2,738.9 $1,004.0 $3,738.6 Net income 73.6 58.0 94.5 31.0 9.1 95.5 28.0 11.8 59.0 20.9 111.7 38.1 14.7 97.1 35.6 38.0 135.1 Restructuring, impairment and other charges, net 56.5 131.5 79.3 2.9 5.9 53.5 5.1 21.1 8.0 27.0 37.5 3.2 25.4 11.2 52.4 4.1 15.3 Spinoff-related transaction expenses - - - - - - - - - - - 0.6-0.6 - - 0.6 Pension settlement charge - - - - - - 0.5-0.5-0.5 - - 0.5 - - 0.5 Acquisition-related expenses 13.8 1.4 1.0-10.5 3.3-3.1-13.6 0.2-0.1-13.7 0.1 0.1 Purchase accounting inventory adjustments, net 10.8 2.2 - - - 10.8-3.2-3.2 7.6-6.7-9.9 0.9 0.9 Gain on bargain purchase - (9.5) - - - - - - - - - - - - - - - Loss on equity investment - - 2.5 - - - - - - - - - - - - - - Depreciation and amortization 181.4 182.0 193.7 45.5 43.1 183.8 43.6 43.0 89.1 86.1 184.4 40.6 48.1 129.7 134.2 47.2 176.9 Interest income-net (2.5) (3.9) (3.8) (0.3) (0.8) (2.0) (0.5) (0.8) (0.8) (1.6) (1.7) 0.5 (0.6) (0.3) (2.2) (0.3) (0.6) Income tax expense 63.9 30.2 42.1 15.9 6.4 73.4 16.3 7.1 32.2 13.5 82.6 18.0 30.2 50.2 43.7 20.2 70.4 Non-GAAP Adjusted EBITDA $397.5 $391.9 $409.3 $95.0 $74.2 $418.3 $93.0 $88.5 $188.0 $162.7 $422.8 $101.0 $124.6 $289.0 $287.3 $110.2 $399.2 Non-GAAP Adjusted EBITDA margin 10.6% 10.2% 10.9% 10.8% 8.6% 11.1% 10.3% 10.1% 10.5% 9.4% 11.2% 10.6% 12.5% 10.6% 10.5% 11.0% 10.7% Net cash provided by operating activities $274.6 $306.7 $312.9 $14.0 $18.9 $269.7 $41.3 $55.3 $55.3 $74.2 $255.7 $80.9 $82.2 $136.2 $156.4 $118.2 $254.4 Capital expenditures (41.6) (60.4) (79.3) (11.9) (13.4) (40.1) (7.2) (9.5) (19.1) (22.9) (37.8) (15.8) (9.4) (34.9) (32.3) (9.3) (44.2) Free cash flow $233.0 $246.3 $233.6 $2.1 $5.5 $229.6 $34.1 $45.8 $36.2 $51.3 $217.9 $65.1 $72.8 $101.3 $124.1 $108.9 $210.2 LSC COMMUNICATIONS 19

NON-GAAP FINANCIAL MEASURES ($ millions) Print Segment Q1 Q1 2016 Q2 Q2 YTD Q2 2016 Q3 Q3 YTD Q4 Q3 2016 2015 2014 2013 2016 2015 LTM 2016 2015 2016 2015 LTM 2016 2015 2016 2015 2015 LTM Magazines, catalogs and retail inserts $1,806.6 $2,035.9 $2,108.7 $406.8 $437.7 $1,775.7 $377.6 $422.9 $784.4 $860.6 $1,730.4 $407.1 $450.3 $1,191.5 $1,310.9 $495.7 $1,687.2 Books 925.0 787.3 827.0 242.8 177.4 990.4 288.0 201.0 530.8 378.4 1,077.4 309.8 292.6 840.6 671.0 254.0 1,094.6 Europe 304.7 381.3 385.1 70.0 74.8 299.9 66.6 69.5 136.6 144.3 297.0 72.1 77.9 208.7 222.2 82.5 291.2 Directories 144.4 148.6 177.3 32.6 33.0 144.0 31.6 37.1 64.2 70.1 138.5 32.4 33.5 96.6 103.6 40.8 137.4 Net sales $3,180.7 $3,353.1 $3,498.1 $752.2 $722.9 $3,210.0 $763.8 $730.5 $1,516.0 $1,453.4 $3,243.3 $821.4 $854.3 $2,337.4 $2,307.7 $873.0 $3,210.4 Income from operations 95.9 46.8 126.6 32.2 18.3 109.8 34.2 7.7 66.4 26.0 136.3 46.7 27.8 113.1 53.8 42.1 155.2 Depreciation and amortization 164.2 164.4 185.4 41.1 38.4 166.9 39.2 38.9 80.3 77.3 167.2 36.8 44.0 117.1 121.3 42.9 160.0 Restructuring, impairment and other charges, net Purchase accounting inventory adjustments, net 53.1 126.9 78.9 3.0 4.6 51.5 5.1 20.6 8.1 25.2 36.0 1.2 24.2 9.3 49.4 3.7 13.0 10.8 - - - - 10.8-3.2-3.2 7.6-6.7-9.9 0.9 0.9 Non-GAAP Adjusted EBITDA $324.0 $338.1 $390.9 $76.3 $61.3 $339.0 $78.5 $70.4 $154.8 $131.7 $347.1 $84.7 $102.7 $239.5 $234.4 $89.6 $329.1 Non-GAAP Adjusted EBITDA margin 10.2% 10.1% 11.2% 10.1% 8.5% 10.6% 10.3% 9.6% 10.2% 9.1% 10.7% 10.3% 12.0% 10.2% 10.2% 10.3% 10.3% Office Products Segment Q1 Q1 2016 Q2 Q2 YTD Q2 2016 Q3 Q3 YTD Q4 Q3 2016 2015 2014 2013 2016 2015 LTM 2016 2015 2016 2015 LTM 2016 2015 2016 2015 2015 LTM Net sales $562.2 $500.3 $242.9 $127.8 $138.0 $552.0 $142.3 $148.5 $270.1 $286.5 $545.8 $127.1 $144.7 $397.2 $431.2 $131.0 $528.2 Income from operations 46.8 39.8 24.1 13.8 8.5 52.1 13.2 13.9 27.0 22.4 51.4 11.2 14.1 38.2 36.5 10.3 48.5 Depreciation and amortization 15.7 15.1 6.2 3.7 4.4 15.0 3.8 3.8 7.5 8.2 15.0 3.7 3.7 11.2 11.9 3.8 15.0 Restructuring, impairment and other charges, net Purchase accounting inventory adjustments, net 3.2 4.6 0.4 (0.1) 1.3 1.8-0.5 (0.1) 1.8 1.3 0.2 1.1 0.1 2.9 0.3 0.4-2.2 - - - - - - - - - - - - - - - Non-GAAP Adjusted EBITDA $65.7 $61.7 $30.7 $17.4 $14.2 $68.9 $17.0 $18.2 $34.4 $32.4 $67.7 $15.1 $18.9 $49.5 $51.3 $14.4 $63.9 Non-GAAP Adjusted EBITDA margin 11.7% 12.3% 12.6% 13.6% 10.3% 12.5% 11.9% 12.3% 12.7% 11.3% 12.4% 11.9% 13.1% 12.5% 11.9% 11.0% 12.1% LSC COMMUNICATIONS 20

ORGANIC GROWTH RATES ($ millions) Magazines, Catalogs, and Retail Inserts Books Europe Directories Total Print Total Office Products Total LSC 3Q 2015 YTD Net Sales as Reported $ 1,310.9 $ 671.0 $ 222.2 $ 103.6 $ 2,307.7 $ 431.2 $ 2,738.9 Pro forma (1) - 117.9 - - 117.9-117.9 $ 1,310.9 $ 788.9 $ 222.2 $ 103.6 $ 2,425.6 $ 431.2 $ 2,856.8 3Q 2016 YTD Net Sales as Reported 1,191.5 840.6 208.7 96.6 2,337.4 397.2 2,734.6 As Reported % Change -9.1% 25.3% -6.1% -6.8% 1.3% -7.9% -0.2% Pro Forma % Change -9.1% 6.6% -6.1% -6.8% -3.6% -7.9% -4.3% Non-GAAP Adjustments: Impact of pass-through paper sales -3.8% 3.8% 0.0% -3.5% -1.0% 0.0% -0.8% Impact of changes in foreign exchange rates -1.0% 0.0% -4.7% 0.0% -0.9% -0.6% -1.0% 3Q YTD Organic % Change -4.3% 2.8% -1.4% -3.3% -1.7% -7.3% -2.5% 3Q 2015 Net Sales as Reported $ 450.3 $ 292.6 $ 77.9 $ 33.5 $ 854.3 $ 144.7 $ 999.0 3Q 2016 Net Sales as Reported 407.1 309.8 72.1 32.4 821.4 127.1 948.5 As Reported % Change -9.6% 5.9% -7.4% -3.3% -3.9% -12.2% -5.1% Non-GAAP Adjustments: Impact of pass-through paper sales -4.3% 5.4% -1.3% 0.0% -0.6% 0.0% -0.5% Impact of changes in foreign exchange rates -0.9% 0.0% -3.3% 0.0% -0.8% -0.2% -0.7% 3Q Organic % Change -4.4% 0.5% -2.8% -3.3% -2.5% -12.0% -3.9% (1) Adjusted for net sales of acquired business: Courier LSC COMMUNICATIONS 21

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