Trading Update and Future Corporate Strategy
Bemrose Corp PLC
2 December 1999
2 December 1999
BEMROSE CORPORATION PLC
Trading Update and Future Corporate Strategy
The Group continues to encounter difficult trading conditions
in Specialist Print Services whilst the turnaround at the
recently acquired distributor businesses, Bourne and PPI, is
taking longer than anticipated. This, together with the start-
up costs of our e-commerce business, 4imprint.com, leads us to
believe that the result for the year is likely to be at the
lower end of the current market expectation at around £12
million profit before tax for continuing operations. The
balance sheet is strong with low gearing.
Specialist Print Services Division
Diary publishing at Letts and calendar production at Derby have
a very heavy seasonal bias to the second half of the year. At
the interim stage, orders for calendars and diaries were at a
similar level to the previous year, but subsequent order intake
has been below the levels expected. There has been little
additional business associated with the Millennium. Security
Printing has held up reasonably well, but commercial print
prices are weak. Action is being taken to reduce the cost base
of the businesses wherever possible. All businesses are
trading profitably but results will be behind prior year.
Promotional Marketing Division
In the first quarter of this year we acquired PPI and Bourne.
PPI supplies promotional merchandise to international companies
and the sponsors of major sporting events. Bourne is similar
to the Broadway division and supplies promotional products to a
wide range of customers. Neither of the acquisitions has
performed profitably, and we are looking at opportunities to
reduce operating costs by sharing of resources where
practicable and by all other means. Broadway Incentives has
continued to trade satisfactorily, but a little behind prior
year in a weaker market. Future prospects for this business
remain good.
Our e-commerce company 4imprint.com is now making progress
after start-up costs of approximately $500,000. Whilst this
activity is at an early stage, we believe that its prospects
are good, and sales are building steadily. The traditional
catalogue business of Nelson Marketing is trading ahead of
prior year.
Future Corporate Strategy
The board recognises that the stock market currently places a
low value on the shares of a large number of smaller companies.
Whilst the result for the year is going to be disappointing we
are mindful of our responsibilities to shareholders to
recognise and to seek to deliver shareholder value. In light
of these circumstances, the Board of Bemrose has instructed NM
Rothschild & Sons to undertake a review of the strategic
options available.
Enquiries Bemrose Corporation plc Tel : 01482 867862
Rodger Booth
N M Rothschild & Sons
David Forbes, Director Tel: 0113 243 4347
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