St. Ives PLC Trading Statement (9998H)
June 14 2017 - 1:00AM
UK Regulatory
TIDMSIV
RNS Number : 9998H
St. Ives PLC
14 June 2017
14 June 2017
St Ives plc ("St Ives" or the "Group")
Trading statement
St Ives, the international marketing services group, provides
the following trading update.
Following a challenging first half of the financial year, the
first four months of the second half have, as anticipated,
delivered a much improved performance; our expectations for the
full year remain unchanged.
Strategic Marketing
Revenue for the Strategic Marketing segment for the first four
months of the second half year was approximately 12% above the
equivalent period in the prior year. Excluding the effects of
currency movements, like-for-like revenue growth was approximately
7%.
As previously reported, we experienced a number of project
cancellations and deferrals in the last quarter of the previous
financial year, which also impacted revenue growth and operating
margin within the first half of the current financial year. We are
encouraged by the fact that the segment has now returned to
delivering like-for-like revenue growth and also that the operating
margin has improved significantly.
Marketing Activation
Trading conditions within our Marketing Activation segment
continue to be very challenging due in large part to the ongoing
pressures within the grocery retail sector, the segment's largest
single market. Revenue was flat in the first four months of the
second half (compared to a 3% decline in the first half) and the
pressure on operating margin remains intense.
The cost reduction measures initiated within the segment have
been implemented and the benefits are helping to mitigate this
margin pressure.
Books
Within our Books business, revenue for the first four months of
the second half was approximately 12% ahead of the equivalent
period in the prior year (compared to an increase of 15% in the
first half) with continued pressure on operating margin.
The previously announced cost reduction and restructuring
measures will be implemented as planned before the end of the
financial year.
Balance Sheet
We continue to look for opportunities to further strengthen the
Group's balance sheet following the recent sale of a non-core
property in Roche for GBP4.2 million, which successfully reduced
debt and created further headroom against our banking covenants.
The Group currently has one further non-core property held for
sale.
Outlook
As discussed at our interim results in March, we continue to
review strategic options for both the Group's Marketing Activation
and Books segments, taking decisive action to improve efficiencies
and reduce costs. This process is ongoing and we will provide
further reports on its progress in due course.
The Board remains confident in the strategy currently being
pursued, and in the long term growth opportunities open to the
Group. The balance sheet remains sound and we have the necessary
cash flow capabilities to support our investment priorities and to
further reduce debt.
- Ends -
For further information contact:
St Ives plc 020 7928 8844
Matt Armitage, CEO
Brad Gray, CFO
MHP Communications 020 3128 8100
John Olsen / Giles Robinson / Gina Bell
This information is provided by RNS
The company news service from the London Stock Exchange
END
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