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4imprint outperforms market growth

Aside from a US election-related blip, the direct marketing company had a good year
March 9, 2017

Digital marketing may be the latest trend in the advertising world, but is it replacing the traditional 'company logo on a water bottle' technique? Judging by full-year results from 4imprint (FOUR), the answer is no. The direct marketing company - which specialises in putting graphics on everything from bags to teddy bears - has reported revenue up 13 per cent, after adjusting for a 53rd week in 2015 and a 2 per cent decline in the UK business caused by currency movements.

IC TIP: Hold at 1702p

But it's the US where 4imprint does the majority of its business, and here, performance was good. Revenue growth of 13 per cent was substantially ahead of the wider industry, driven by the addition of 240,000 new customers. But growth slowed in the fourth quarter, which management attributed to uncertainty caused by the US election. Weak trading patterns correlated directly with the six- to eight-week period leading up to the November vote.

Broker finnCap expects adjusted pre-tax profit and EPS of $44.1m (£36.3m) and 110ȼ, respectively, for the year to December 2017 (from $38.4m and 98.7ȼ in FY2016).

4IMPRINT (FOUR)

ORD PRICE:1,702pMARKET VALUE:£478m
TOUCH:1,656-1,702p12-MONTH HIGH:1,900pLOW: 1,197p
DIVIDEND YIELD:2%PE RATIO:24
NET ASSET VALUE:104ȼNET CASH:$21.7m

Year to 31 DecTurnover (£m)Pre-tax profit (£m)Earnings per share (p)Dividend per share (p)
20121846.416.415.45
($m)($m)(ȼ)(p)
201333314.540.117.00
201441623.359.720.45
2015*49731.281.326.57
201655834.287.341.82
% change+12+9+7+57

Ex-div: 6 Apr

Payment: 12 May

*53-week period to 2 Jan 2016 £1=$1.22