4imprint is the leading direct marketer of promotional products in the United States, Canada, the UK and Ireland. In FY22, 98% of revenues were generated in the United States and Canada.
The US promotional products distribution market is highly fragmented and PPAI estimated its 2023 value at over US$26bn, up 3.1% on the year. This is ahead of the World Bank’s US real GDP estimated increase of 2.5%. However, US inflation in 2023 is estimated at 3.4%, implying that underlying volume growth is likely limited still. Some questions remain about confidence in the US corporate sector, but the utility of promotional products is high and sector prospects remain positive.
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David Seekings
FD
Kevin Lyons-Tarr
CEO
Forecast net cash (US$m)
125
Forecast gearing ratio (%)
N/A
% | 1M | 3M | 12M |
---|---|---|---|
Actual | 12.5 | 33.9 | 25.9 |
Relative | 9.1 | 30.5 | 17.6 |
52 week high/low | 6280.0p/4200.0p |
4imprint’s FY23 results are as outlined in January’s trading update, with 16% top-line growth and a further step up in operating margin to 10.3% from 9.0%. Given that the trading backdrop became more difficult over the final few months, as shown in industry reports, this implies that the group continues to build share in its large and fragmented addressable market for promotional products. 4imprint ended the year with net cash and short-term deposits of $105m after particularly strong cash conversion in H2. This amply allows for the expansion project at the main Oshkosh distribution centre as well as a good uplift in the final dividend, making 215 cents for the year, with the shares trading at a yield of approximately 3%.
Y/E Dec | Revenue (US$m) | EBITDA (US$m) | PBT (US$m) | EPS (fd) (c) | P/E (x) | P/CF (x) |
---|---|---|---|---|---|---|
2022A | 1140.3 | 108.4 | 103.7 | 285.6 | 28.1 | 22.3 |
2023A | 1326.5 | 142.6 | 140.7 | 377.9 | 21.2 | 13.5 |
2024E | 1430.0 | 149.9 | 146.5 | 395.2 | 20.3 | 16.7 |
2025E | 1500.0 | 157.0 | 153.8 | 408.7 | 19.6 | 13.9 |