30th Nov 2010 07:00
30 November 2010
St Ives plc - Interim Management Statement and Board Changes
St Ives is today publishing its Interim Management Statement covering the period from 31 July 2010 to date.
We are pleased to report that we have made a good start to the current financial year and that we have made further progress in reversing the decline in sales that we experienced in the previous financial year.
Sales for the 13 week period ending 29 October 2010 were broadly in line with those for the corresponding period in the prior year and were achieved despite tough market conditions, ongoing price pressure and the removal of uneconomic capacity within our magazine and commercial web offset businesses. We have grown underlying volumes and are confident that our investment in additional sales and marketing resources will support our strategy to improve margins and help reposition the business away from commoditised print.
The recently acquired Occam business has been successfully integrated; we are encouraged by some early successes in both winning new business and cross selling Occam's services into the Group's existing customer base. We continue to invest in extending the range of services and solutions we provide and to seek opportunities to add value and complementary services to our print offering.
We have secured the sale of our head office building in London for cash proceeds of £6.3 million and will move into more suitable leased premises nearby by March 2011. The plans to relocate our main Exhibition and Events business, from its current premises in Wandsworth to a new facility in Chessington, are progressing well and are on schedule to complete by January 2011. We are investing in a new financial reporting system across the Group due for implementation during 2011.
Media Products
Our book business remains robust and is benefitting from steady demand, its market leading position and the investment that we have made in the latest digital technology. Excess capacity within the magazine sector continues to exert downward price pressure but we have benefited from some new business wins and increases in pagination as advertising expenditure starts to increase, albeit from a low base.
Commercial Products
The market for direct response and commercial remains very tough and, following the closure of our Edenbridge facility, additional outwork costs have been incurred during the installation of the transferred press into the Peterborough plant, leading to further short term margin pressure.
Activity remains strong in the Point Of Sale market and the new management team is winning new business, improving operational efficiencies and strengthening the sales team.
The exhibition and events market continues to improve and volumes are increasing. Margins are being impacted by the disruption associated with relocating the main production facility and the inefficiencies inherent with our current premises. The move, and investment in additional capacity and IT infrastructure, will position the business well for what will be a significant increase in activity leading up to and during the Olympics.
The Group's financial position remains strong and we continue to keep our cost base under close review. The economic climate is challenging and whilst there is some improvement in underlying volumes, margins remain under pressure. Our strategic focus is to continue to move away from the commoditised end of the print market and to grow a portfolio of added value products and services to help our customers maximise returns from their investment in print. Whilst visibility is poor, we are confident that the Group will make further progress during the current financial year.
Board Changes
Miles Emley will be stepping down as chairman and leaving the board at the end of the Company's financial year. The board intends to appoint Richard Stillwell, who has been a non-executive director since 2006, as chairman in his place. Tony Stuart, formerly a managing director of N M Rothschild & Sons Limited, is to be appointed a non-executive director with effect from 31 January 2011.
For further information please contact:
St Ives plc 020 7928 8844Miles Emley, ChairmanPatrick Martell, Chief ExecutiveMatt Armitage, Finance DirectorSmithfield 020 7360 4900
Will Swann
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