Photobition fails to - Richmond Capital · PDF filerise Ricoh Leasing,maker of ... fall in...
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14|Printing World|October 22 2001 finance By Alex Grant Photobition chief executive Eddie Marchbanks has failed in his management buyout bid after venture capitalists Alchemy Part- ners withdrew its backing last week. And yet another profits warning has prompted finance director Steven Smith, who would have probably taken part in the mbo, to resign. Having predicted a small profit before exceptional items and interest payments in the year to June, Photobition is now warning that it has made a loss. Shares have halved in value from 4p to just 2p, down from a high of 556p in January 2000, although they later rallied to 3.5p. The Photobition Forum – a group of shareholders headed by former Photobition director Bob Bushby – has given up its fight for a change in management of the company and to keep it public. “We are in utter disbelief,” says the Forum’s Adrian Harvey. “There is nothing more we can do. It is very unlikely that the firm will continue in public ownership and there is a real possibility of admin- istration. The situation is changing almost hourly.” The Forum had argued that Photobition’s non-executive directors, in particular chairman Richard Reynolds, have “com- pletely ignored” their requests for the company’s assets, including its North American interests, to be evaluated and sold off if necessary. Photobition’s expansion into the US market has been blamed for its problems since. “Shareholder value is effec- tively zero and the company is in the hands of its lenders,” says Mr Harvey. Photobition says it is studying two options: a further equity issue or a deferral of inter- est payments for two years. Meanwhile, Photobition’s for- mer UK Graphics finance manager David Seaman is taking his ex-employer to an employ- ment tribunal next month, claiming unfair dismissal. [email protected] In brief ● Alchemy walks away from Photobition ● Forum group gives up fight ● Shares down to 3.5p each Photobition fails to turn lead into gold Quarterly results Jefferson Smurfit, the Irish print and packaging group, is going over to the US practice of giving its results quarterly from next May,now that 50% of its shares (up from 14% in 1995) are now held in the US.‘Jefferson Smurfit is the first Irish industrial company to achieve and sustain this level of US investment,’ says chairman and chief executive Michael Smurfit.Average daily trading volume in its shares has risen from 24,000 in the first half of 1999 to 50,000 in the first half of this year. Ricoh sees rise Ricoh Leasing, maker of printing equipment, medical equipment and machine tools, has bucked the trend and predicted a 10% rise in profits to Y5.3bn for the year to March 2002. WPP in retreat WPP,the advertising group that has tried to take over Tempus Group, has changed its mind and is now trying to extricate itself even though at least 74% of Tempus shareholders have accepted WPP’s £350m offer.WPP has had second thoughts because there has been a ‘material adverse change’ in the advertising market and a fall in Tempus’s value, since its bid was first launched in August, and especially since September 11. X-Rite’s autumn sale Page 26 Xerox has suffered a worse than expected loss in the third quarter and now says it is only “cau- tiously” optimistic about a profit in the fourth. Xerox expects the third quarter results, due on October 23, to show sales of between $3.8bn and $4bn, and a loss of 22-25 cents per share. Wall Street ana- lysts had been expecting a loss of only 12 cents per share. President and chief executive Anne Mulcahy says that Xerox was faring quite well in July and August, but then suffered a “sig- nificant impact” on sales, and insurance excess payments on its own World Trade Centre premises, after the September 11 attacks. Xerox will not put a figure on the decline in sales. Until September 11, the com- pany is said to have been “solidly on track” and meeting sales tar- gets. But the last two weeks in September are normally the strongest of the third quarter for Xerox’s sales because it is when customers return from summer holidays. ● Hewlett Packard chief execu- tive Carly Fiorina has told journalists that the consumers “stopped dead in their tracks” in the wake of the September 11 attacks. She denied that HP is planning to spin off its printing division in the wake of its merger with Compaq. [email protected] In brief ● Xerox warns over third quarter ● Impact of September 11 attacks ● HP says consumers stopped spending Xerox expects worse Q3 Ann Mulcahy: ‘Significant impact’ Printing.com breaks cash threshold Printing.com, the loss making quick printer chain, says it has reached the break-even point for cash positive trading. Sales in the month to October 15 were £471,000, above the £465,000 threshold for cash generation. Printing.com should break into profit when sales are more than £500,000 a month. Each store is now generating sales of £24,000 a month on average. But Printing.com’s web- site only generated sales of £120,000 last year. “It’s a channel for sales, but not a fantastically successful one,” says finance director Alan Roberts. But a new deal with Arsenal FC means that fans can order personalised business cards at www.arsenal.co.uk, printed on Printing.com’s Komoris in Salford. [email protected] In brief ● Printing.com reaches break-even ● Each store generates £24,000 ● Looking to Arsenal FC deal Electronics for Imaging’s sales have fallen by more than 15% in the three months to September 30, and profits have almost halved from $20m to $11m. Although sales have fallen from $153m to $127m, chief executive Guy Gecht hopes that EfI’s new products like the Fiery Z5 and Z18 platforms will sell better. EfI warned earlier this month that annual profits would fall this year for the first time in the company’s history (Printing World, October 8). The company now expects fourth-quarter sales to be between $108m and $113m, down from $132m last year, because of “continuing weak global spending,” says Mr Gecht. [email protected] In brief ● EfI sees first profits fall ● New products seen as way forward ● Weak global spending continues Electronics for Imaging sees profits halved Eddie Marchbank’s mbo bid has failed 14-15 Finance 18.10.01 10.35 am Page 14
Transcript of Photobition fails to - Richmond Capital · PDF filerise Ricoh Leasing,maker of ... fall in...
14|Printing World|October 22 2001
finance
By Alex GrantPhotobition chief executive EddieMarchbanks has failed in hismanagement buyout bid afterventure capitalists Alchemy Part-ners withdrew its backing lastweek.
And yet another profitswarning has prompted financedirector Steven Smith, who wouldhave probably taken part in thembo, to resign. Having predicteda small profit before exceptionalitems and interest payments inthe year to June, Photobition isnow warning that it has made aloss.
Shares have halved in valuefrom 4p to just 2p, down from ahigh of 556p in January 2000,
although they later rallied to 3.5p.The Photobition Forum – a groupof shareholders headed by formerPhotobition director Bob Bushby– has given up its fight for achange in management of thecompany and to keep it public.
“We are in utter disbelief,” saysthe Forum’s Adrian Harvey.“There is nothing more we can do.It is very unlikely that the firm willcontinue in public ownership andthere is a real possibility of admin-istration. The situation ischanging almost hourly.”
The Forum had argued thatPhotobition’s non-executivedirectors, in particular chairmanRichard Reynolds, have “com-pletely ignored” their requests for
the company’s assets, includingits North American interests, to beevaluated and sold off if necessary.
Photobition’s expansion into
the US market has been blamedfor its problems since.
“Shareholder value is effec-tively zero and the company is inthe hands of its lenders,” says MrHarvey. Photobition says it isstudying two options: a furtherequity issue or a deferral of inter-est payments for two years.
Meanwhile, Photobition’s for-mer UK Graphics financemanager David Seaman is takinghis ex-employer to an employ-ment tribunal next month,claiming unfair [email protected] brief� Alchemy walks away from Photobition� Forum group gives up fight� Shares down to 3.5p each
Photobition fails toturn lead into gold
QuarterlyresultsJefferson Smurfit, theIrish print and packaginggroup, is going over to theUS practice of giving itsresults quarterly fromnext May,now that 50%of its shares (up from14% in 1995) are nowheld in the US.‘JeffersonSmurfit is the first Irishindustrial company toachieve and sustain thislevel of US investment,’says chairman and chiefexecutive MichaelSmurfit.Average dailytrading volume in itsshares has risen from24,000 in the first half of1999 to 50,000 in thefirst half of this year.
Ricoh seesriseRicoh Leasing,maker ofprinting equipment,medical equipment andmachine tools,hasbucked the trend andpredicted a 10% rise inprofits to Y5.3bn for theyear to March 2002.
WPP inretreatWPP, the advertisinggroup that has tried totake over Tempus Group,has changed its mindand is now trying toextricate itself eventhough at least 74% ofTempus shareholdershave accepted WPP’s£350m offer.WPP hashad second thoughtsbecause there has beena ‘material adversechange’ in theadvertising market and afall in Tempus’s value,since its bid was firstlaunched in August,andespecially sinceSeptember 11.
X-Rite’sautumnsalePage 26
Xerox has suffered a worse thanexpected loss in the third quarterand now says it is only “cau-tiously” optimistic about a profitin the fourth.
Xerox expects the third quarterresults, due on October 23, toshow sales of between $3.8bnand $4bn, and a loss of 22-25cents per share. Wall Street ana-lysts had been expecting a loss ofonly 12 cents per share.
President and chief executiveAnne Mulcahy says that Xeroxwas faring quite well in July andAugust, but then suffered a “sig-nificant impact” on sales, andinsurance excess payments on itsown World Trade Centrepremises, after the September 11
attacks. Xerox will not put a figureon the decline in sales.
Until September 11, the com-pany is said to have been “solidlyon track” and meeting sales tar-
gets. But the last two weeks inSeptember are normally thestrongest of the third quarter forXerox’s sales because it is whencustomers return from summerholidays.� Hewlett Packard chief execu-tive Carly Fiorina has toldjournalists that the consumers“stopped dead in their tracks” inthe wake of the September 11attacks. She denied that HP isplanning to spin off its printingdivision in the wake of its mergerwith [email protected] brief� Xerox warns over third quarter� Impact of September 11 attacks� HP says consumers stopped spending
Xerox expects worse Q3
Ann Mulcahy: ‘Significant impact’
Printing.combreaks cashthresholdPrinting.com, the loss makingquick printer chain, says it hasreached the break-even point forcashpositive trading.
Sales in the month to October15 were £471,000, above the£465,000 threshold for cashgeneration.
Printing.com should breakinto profit when sales are morethan £500,000 a month.
Each store is now generatingsales of £24,000 a month onaverage. But Printing.com’s web-site only generated sales of£120,000 last year.
“It’s a channel for sales, but nota fantastically successful one,”says finance director AlanRoberts.
But a new deal with Arsenal FCmeans that fans can orderpersonalised business cards atwww.arsenal.co.uk, printed onPrinting.com’s Komoris inSalford. [email protected] brief� Printing.com reaches break-even� Each store generates £24,000� Looking to Arsenal FC deal
Electronics for Imaging’s saleshave fallen by more than 15% inthe three months to September30, and profits have almosthalved from $20m to $11m.
Although sales have fallenfrom $153m to $127m, chiefexecutive Guy Gecht hopes thatEfI’s new products like the Fiery
Z5 and Z18 platforms will sellbetter.
EfI warned earlier this monththat annual profits would fall thisyear for the first time in thecompany’s history (PrintingWorld, October 8).
The company now expectsfourth-quarter sales to be
between $108m and $113m,down from $132m last year,because of “continuing weakglobal spending,” says Mr [email protected] brief� EfI sees first profits fall� New products seen as way forward�Weak global spending continues
Electronics for Imaging sees profits halved
Eddie Marchbank’s mbo bid has failed
14-15 Finance 18.10.01 10.35 am Page 14
legal notices
Printing World|October 22 2001|15
Compulsorywinding upThe following case is due to beheard at The Guildhall, SmallStreet, Bristol� MWA Publishing Ltd BrooklynHouse, Broadbush, Blunsdon,Swindon SN2 4DH onNovember 15 at 10am. Petition byESP Colour Ltd
Appointment ofliquidators� Stonehouse Publishing LtdPublishing. Liquidators: SAClark, Ratcliffe & Co, 57 VictoriaSquare, Bolton BL1 LA� Reams Ltd Printer. Liquidators:N Barber and N Henry, LinesHenry, 27 The Downs,Altrincham, Cheshire WA142QD� Original Print Solutions LtdPrevious company names: OpusPrint Services Ltd, Opus PrintSolutions Ltd Printing agent.Liquidators: WJ Turner and KAMurphy, RZQ LLP, ParadeHouse, 135 The Parade, HighStreet, Watford WD17 1NS� Greenups Packaging LtdLiquidators: AG Stoneman andJJ Godefroy, Menzies CorporateRestructuring, 17-10 Foley Street,London W1W 6DW� Greenfield Paper Co LtdPrevious company name: Shelfco(No 582) Ltd Liquidator: ID
Williams, Benedict Mackenzie,62 Wilson Street, London EC2A2BU�User Friendly Repro LtdReprographics, film and printing.Liquidator: JM Titley, DTE, DTEHouse, Hollins Mount, HollinsLane, Bury BL9 8AT� Reilly Design & Print Ltd Printer.Liquidators: RJ Elwell and GSWolloff, Elwell Watchorn &Saxton, 109 Swan Street, Sileby,Leicestershire LE12 7NN� Good Press Ltd Newspaper andmagazine distribution.Liquidator: SR Cork, ProspectHouse, 2 Athenaeum Road,London N20 9YU� Imperial Graphics Group ServicesLtd Previous company names:Royal Sovereign Group Services CoLtd and Emerstone ManagementLtd. Imperial Graphics Products Ltd(Previous company name:Tradeward Ltd) Liquidators: E Bingham, Ernst & Young, RollsHouse, 7 Rolls Buildings, FetterLane, London EC4A 1NH
Meetings ofcreditors� Kent Paper Co Ltd at AshfordInternational Hotel, SimoneWeil Avenue, Ashford, KentTN24 8UX on October 18 � Rushton Marine Press Ltd, BalticPublishing Ltd, Baltic Media GroupLtd at the London Society ofChartered Accountants,
15 Basinghall Street, LondonEC2V 5BR on October 24 at11.30am, 11.35am and 11.40amrespectively� Forme Print & Design Ltd at 228 Shoreditch High Street,London E1 6PJ on October 15� Micro Graphix Ltd at HLBKidsons, Bank House, 8 CherryStreet, Birmingham B2 5AD onOctober 18� MCS Digital Reprographics Ltd atStephen Conn & Co, 17 St Ann’sSquare, Manchester M2 7PW onOctober 22 at 3pm� Cursor Graphics Ltd at TheConifers, Filton Road,Hambrook, Bristol BS16 1QG onOctober 26 at 11am
Notices tocreditors� Dayprint Humberside LtdCreditors to send claims to MCBowker, Jacksons Jolliffe Cork, 33 George Street, Wakefield WF11LX by November 30
Final meetings� Dowland Press Ltd at 1 BridewellStreet, Bristol BS1 2AA onNovember 6 at 10am� Officehaste Projects Ltd (t/a KallKwik Centres 1237 and 1239) atParkville House, 16 Bridge Street,Pinner, Middlesex HA5 3JD onNovember 23 at 2pm formembers and at 2.15pm forcreditors
AD
VIC
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usin
ess
GROW-HOWBusiness
From Paul Holohan & the team at
Richmond Capital Partners Limited
Tel: 0207 636 5491
Facsimile: 0207 436 8954
Email: [email protected]
Web: www.richmondcapitalpartners.com
We run a medium sized printing business andwould like to provide a budget for marketingas we need to grow sales. Any ideas?
First you need a Marketing Plan. Never commencepromotional activity before you have developedyour strategy and planned for its execution.
Second you should develop an integrated promotional package which combines several relevant activities (e.g. direct mail, e-mail, PR,advertising, website).
Next, execution of the activity is critical.Remember the following:-
1. Set clear objectives with a well defined brief.This is absolutely vital. Get it right and the wholecampaign can be effected with clarity and focus.Get it wrong and your hard earned money will bewasted.
2. Understand your target audience. Tap into everyexisting source of information and data and giveyour creative and copywriting team a detailedunderstanding of who you are selling to. Yourmarketing database (if you have one) should provide the best and most economical source ofinformation. In short you should be looking topaint as full and vivid a picture as possible of thetypical individual you aim to reach.
3. Get the creative right. Ensure that your creativeapproach is in harmony with your brand values. Inparticular look at imagery, style and language andensure that they meet the brief.
4. If you are buying a mailing list, it is usually better to use the services of a reputable list broker.
5. Evaluate the response. There are many ways toevaluate a campaign and you should consider howyou performed against your original objectives.Typically you should use:-
i) response per thousandii) conversion per thousandiii) return on investment (ROI)
Finally, like most things in life, it is best to takeprofessional advice. After all, would you buy ahouse without using a chartered surveyor?
In my experience there are several organisationspromising the earth to printing businesses at themoment. Most of them are not qualified, do notunderstand the industry and cannot provide references.
Do not pay money up front to these people.
Use a qualified marketing professional (‘CharteredMarketer’) for the plan. It is a sound investmentand will save you money overall. Industry experience and a proven track record are alsohighly desirable.
We congratulate you on your approach to growingsales. Most printing companies use recruitment ofsales people as the only route to grow sales.Whilst one should not rule out recruitment itshould be noted that this is only one method ofgrowing your sales.
Good marketing!
The author accepts no legal responsibility for the advice given.Comments and advice given in this column do not necessarily represent the views of Printing World.
PROMOTIONALACTIVITY
M E R G E R S • A C Q U I S I T I O N S • D I S P O S A L S • J O I N T V E N T U R E S
Newspapers have been winnersand losers since September 11 –with an increase in copy sales off-set by a fall in advertising incomeand higher paper costs as pagina-tion has risen.
Even before September 11, areport from market analysts KeyNote predicted trouble aheadbecause of an expected 10%-20%rise in newsprint rises by the endof 2001.
With advertising revenue stag-nant or falling, the pressure is onfor cover price increases, whichhave already taken place at TheIndependent, The Guardian andFinancial Times.
Without cover price rises,some say that newspapers mayfind themselves in the absurd sit-uation of not being able to afford
new readers as the increase inproduction costs could outstripthe increase in revenue. Mostnewspapers saw their circula-tions rise by up to 10% – awhopping 14% in The Observer’scase – after September 11.
Merrill Lynch has lowered itsprofits forecast for Trinity Mirrorby 3% to £150m, mainly becauseof the post-September 11 changesin newspaper economics. Pear-son, publisher of the FinancialTimes, warned last week of a 40%fall in profits if the fall in advertis-ing continues. Pearson sharesare down 5%.
However, there are signs thatnewsprint prices, which lastwinter rose 15% between Januaryand March, may not now rise anyfurther because of pressure from
cash-strapped publishers. Priceshave been remarkably steadysince September 11, at around�610 per tonne for 45gsmnewsprint.
And Gannett, which owns theNewsquest titles in the UK, saysthat it now expects a “quickerrebound” from the downturn inadvertising revenue, despitelosing $15m-$20m in the wake ofthe September 11 attacks.
There are signs that consumermagazines, if not newspapers,are gaining some of the revenuethat is moving away from televi-sion. [email protected] brief� September 11 effect on newspapers� Lower ad sales,higher costs� Hopes of a sector recovery
Newspapers win and lose
14-15 Finance 18.10.01 10.35 am Page 15
