St Ives has spent the last three years selling off or closing down parts of its old printing empire, with the final step coming in November when it announced the closure of factories in Westerham and Blackburn that printed company reports and CD inserts. It's using the proceeds to set up a completely new division called 'marketing services', which chief executive Patrick Martell wants to eventually provide 40 per cent of profits, double the current proportion.
To that end, the company has acquired three marketing services companies since the July year-end. Response One uses data to help companies find new customers; Pragma is a consultancy specialising in retail markets; Incite offers high-end market research. The connection between these new businesses and the old print works is the customer base, says Mr Martell – St Ives already sells printed marketing material to companies, and now it can sell them marketing insight too.
The reported results were hit by £8.5m of one-off costs associated with the closures and acquisitions. Underlying pre-tax profits were up 8.7 per cent to £11.1m, thanks to the shift towards a more profitable business mix.
Broker Numis expects full-year adjusted pre-tax profits of £23.9m, giving EPS of 15p (from £21m and 14.5p in 2011).
ST IVES (SIV) | ||||
|---|---|---|---|---|
| ORD PRICE: | 85p | MARKET VALUE: | £96.9m | |
| TOUCH: | 84-85p | 12-MONTH HIGH: | 114p | LOW: 65p |
| DIVIDEND YIELD: | 6.2% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 120p* | NET DEBT: | 7% | |
| Half-year to 27 Jan | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 149 | 12.7 | 8.57 | 1.75 |
| 2012 | 168 | 2.5 | 0.82 | 1.75 |
| % change | +12 | -80 | -90 | – |
Ex-div: 4 Apr Payment: 9 May *Includes intangible assets of £80.3m, or 70p a share | ||||
