22-11-2006 - Printing.com - Now ready to print money - Birmingham Post
Specialist printing firm Printing.com has overcome a summer lull to post almost static first half profits.The Manchester company, which operates 12 sites across the Midlands, said it was in a position to "significantly move forward" after warning of a deterioration in trading during June and July.
The downturn was exacerbated by disruption caused by expansion at its Hub site in Manchester where its printing takes place.
Printing.com's stores and franchises do not depend on any printing equipment on location but orders are sent electronically to the Hub.
Reporting its figures for the 28 weeks to October 15 yesterday, the company said it increased pretax profits by 0.7 per cent from £1.019 million to £1.026 million.
Total retail sales - the measure the company said best indicates transactional volumes - increased by 15.9 per cent to £10.879 million.
Turnover marginally decreased by 3.4 per cent to £6.187 million, reflecting the change in ownership of several stores and the legacy 'Agency' division.
In previous periods these were company owned and total retail sales were included in turnover.
In the period under review, now under franchise ownership, Printing.com's turnover only included the wholesale value of these orders, with the balance passed to the franchisee.
Chief executive Tony Raf-ferty said: "As previously reported at the company's AGM, trading deteriorated during June and July with the downturn being more than would simply reflect the usual summer seasonality.
"It was also reported that disruption pertaining to the Hub expansion restricted certain options which could ordinarily have been used to mitigate such conditions: accordingly the company revised its budget for the year.
"We are pleased to report that following the last update on July 28, and save for the first two weeks of August, trading has proved more encouraging.
"As a result, the penultimate and final four-week trading periods, ending September 17 and October 15, saw volumes inline with the company's current budget. Encouragingly, the first period of the second half has also followed this more positive trend."
Mr Rafferty said the better trading was a result of improvements in the market and to more potent promotional offers that are now possible following the Hub expansion, which doubled capacity there from £20-£25 million of sales per year to £40-£45 million.
The firm had also bolstered its international strategy by selling a franchise in New Zealand with an option granted for Australia.
The firm said an option had been taken out over Poland, while discussions were underway about launching Printing.com elsewhere in Europe and the US.
Mr Rafferty said: "Whilst the fiscal performance of the interim period versus the previous year could be construed as one of consolidation, we firmly believe that the operational developments provide the basis for the company to significantly move forward."
Jon Lienard, analyst at Brewin Dolphin, said: "The lower volumes referred to in the AGM statement in July appear to have been consigned to history.
"Volumes at the end of the first half and into the second half were said to be in line with revised expectations."
Shares closed up 4 at 50p.