What happened

Shares of R.R. Donnelley & Sons (RRD) climbed as much as 10% higher on Monday after the marketing company reworked its credit facilities. Managing debt had been a real challenge for Donnelley in recent years, and this is a big step toward getting its house in order.

So what

R.R. Donnelley is a 157-year-old printing company in the process of modernizing. As business has moved online, Donnelley has pushed to extend its focus beyond paper, now offering a range of multichannel business communications services and marketing products.

A graphic illustration of data analysis.

Image source: Getty Images.

At the same time, the company has been looking to rework its debt. The balance sheet was a constant theme of Donnelley's February earnings call, with CEO Dan Knotts noting, "We substantially reduced our debt outstanding," including by extending upcoming maturities as part of a plan to increase balance sheet flexibility.

The company continued that effort on Monday, announcing it has completed an amendment to its asset-based credit agreement (ABL), extending maturities to April 2026. Pricing on the deal is strong, with applicable margin for base rate loans priced from 0.25% to 0.75%.

"Our successful completion of the ABL Amendment, in addition to last week's pricing of $400 million of senior secured notes, demonstrates our sustained commitment to improving our financial flexibility in support of our strategic priorities," the company's executive vice president and chief financial officer, Terry Peterson, said in a statement.

Now what

R.R. Donnelley shares are down more than 80% over the past five years, but the stock has more than doubled so far in 2021.

Which is to say, this is a company that is still very much in the middle of a long-term turnaround, and the future is far from certain. Getting the balance sheet in order is a big part of the process, and investors are understandably feeling a little better about Donnelley today.