Once upon a time, St Ives Plc was a printer, book-binder and supplier of printing materials. Today, the group no longer operates in the print space at all – having redefined itself as an “international digital transformation” specialist under the moniker Kin + Carta (KCT).
Research house IDC predicts that the digital transformation (or ‘DX’) market could reach nearly $2 trillion by 2022. There was enough in Kin + Carta’s half-year numbers to provide early encouragement for investors, although the shares’ markdown on results day might have reflected concerns over working capital levels and the reversion to a pension deficit.
The innovation business – “the core” of Kin’s offering – constituted 46 per cent of revenues, against 39 per cent a year earlier. But this momentum was set against a tough comparative – revenues soared by 63 per cent in HY2018.
Sales at the other two divisions – strategy and communications – fell by 8 per cent and 14 per cent respectively on a like-for-like basis. Kin attributed this to moving away from “lower-margin work in the short term”, enabling it to target larger, higher-margin clients over the long term.
Broker Numis expects adjusted pre-tax profits of £18.4m and EPS of 9.6p for the year to July 2019, against £18.5m and 10.1p in FY2018.
| KIN + CARTA (KTC) | ||||
| ORD PRICE: | 87.5p | MARKET VALUE: | £ 134m | |
| TOUCH: | 87.1-88.8p | 12-MONTH HIGH: | 111p | LOW: 82p |
| DIVIDEND YIELD: | 2.2% | PE RATIO: | na | |
| NET ASSET VALUE: | 46p* | NET DEBT: | 47% | |
| Half-year to 31 Jan | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2018** | 91.7 | -19.3 | -14.0 | 0.65 |
| 2019 | 87.2 | -1.6 | -1.1 | 0.65 |
| % change | -5 | - | - | - |
| Ex-div: | 11 Apr | |||
| Payment: | 10 May | |||
| *Includes intangible assets of £113m, or 73p a share**2017 numbers pertain to 189 days to 2 February 2018 | ||||
