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4imprint Group — Improved trading feeds through to upgrades

4imprint Group (LSE: FOUR)

Last close As at 05/08/2026

GBP48.90

▲ 500.00 (11.39%)

Market capitalisation

GBP1,378m

More on this equity

Research: TMT

4imprint Group — Improved trading feeds through to upgrades

4imprint’s (FOUR’s) H126 results show more-encouraging trends through H126 from a new orders perspective. While negative year-on-year, the decline has moderated. In addition, management has been successful at passing on targeted price increases to mitigate the cost pressures from tariffs, delivering better margin protection than it expected at the start of the year. The better-than-expected H126 performance leads to an upgrade to management’s adjusted profit before tax (PBT) guidance of c 9% versus our prior estimate. A continuation of these more-encouraging trends would support further upgrades.

Written by

Russell Pointon

Director of Content, Consumer and Media

Media

H126 results

5 August 2026

Price 4,390.00p
Market cap £1,237m

Net cash at 27 June 2026 (excluding IFRS 16 liabilities of $2.9m)

 $136.9m

Shares in issue

 28.2m
Free float 97.6%
Code FOUR
Primary exchange LSE
Secondary exchange N/A

Share price performance

Price Performance
% 1m 3m 12m
Abs 19.3 21.2 23.6
52-week high/low 4,424.0p 2,884.8p

Business description

4imprint Group is a leading direct marketer of promotional products in the United States, Canada, the UK and Ireland. In FY25, 98% of revenues were generated in the US and Canada.

Next events

10-month trading update

November 2026

FY26 trading update

January 2027

Analysts

Russell Pointon
+44 (0)20 3077 5700
Chloe Wong
+44 (0)20 3077 5700
tmt@edisongroup.com
Edison profile page

4imprint Group is a research client of Edison Investment Research Limited

Note: PBT and EPS are underlying. FY24 DPS includes a special dividend.
Year end Revenue ($m) PBT ($m) EPS (¢) DPS (¢) P/E (x) Yield (%)
12/24 1,367.9 154.4 415.31 490.00 14.2 8.3
12/25 1,346.8 150.8 403.31 240.00 14.6 4.1
12/26e 1,351.4 129.6 350.52 240.00 16.8 4.1
12/27e 1,370.5 133.2 355.07 240.00 16.6 4.1

Trends more encouraging in H126

The key financial headlines are revenue increased by 1.1% in H126, the gross margin declined by 130bp to 31.5% giving c 3% lower gross profit, and adjusted operating profit was 11.6% lower with a similar 130bp reduction in operating margin versus H125. The main revenue drivers were a c 3% increase in average order value, with improving recovery of tariff-related costs as H126 progressed, offset by 1.3% fewer orders. While overall orders continued to decline in H126 and with existing customer orders broadly unchanged, there were more-encouraging trends in orders received from new customers as the period progressed, with a Q226 decline of 5% following a 9% decline in Q126. Changes in the growth rates in orders from new customers are an important indicator of the business’s potential growth. The declared interim dividend of 80c/share is unchanged versus H125. Adjusting items related to uncertain tax treatments were included in management’s announcement (discussed below).

A healthy upgrade to profit estimates

The better-than-expected H126 performance enabled management to increase its FY26 guidance to revenue slightly above FY25’s $1.35bn and adjusted PBT of ‘approximately $130m’. The revenue guidance implies a modest year-on-year revenue decline in H226, partly reflecting the annualisation of price increases that began in H225. The delivery of PBT of exactly $130m would represent a decline of c 14% y-o-y from FY25’s $150.8m; more importantly it would represent an upgrade of c 9% from our prior estimate. Our new FY26 estimate of $129.6m incorporates a modest pick-up in marketing spend, as we assume management continuously tests to ascertain the strength of any potential recovery. Our FY27 forecasts reflect the higher FY26 base and no changes to our assumptions for growth rates or cost ratios.

Valuation discount to historical multiples

A return to growth and higher profitability would be supportive of a re-rating towards historical multiples (see Exhibit 3).

H126: Better trends in volume and prices

In Exhibit 1 we show a number of FOUR’s core KPIs and the financial results for FY24 to H126 as well as our new forecasts for FY26 and FY27. We include FY24 to demonstrate the disruption to FOUR’s growth and profitability as a result of the introduction of tariffs at the start of FY25.

Following the 3% decline in total orders received through FY25, there has been a clear slowing in the rate of decline to 1.3% in H126. The key driver of the decline has been orders from new customers, while existing customers have been relatively loyal, with small growth/declines since the start of FY25. The decline in orders from new customers was significant in FY25 at c 12%, but eased to c 7% in H126, with management noting a lower rate of decline in Q226 of 5% versus Q126’s 9%.

Of particular interest is the 3% growth in average order value that FOUR enjoyed in H126. Following flat prices in H125, management began to introduce targeted price increases to mitigate the new import tariffs, which led to growth in the average order value of 1% for the full year, implying c 2% increases in H225. The targeted price increases have continued through H126, and we note the benefits of these has increased through the period. At the AGM in May 2026, management highlighted an increase in average order value of 2% in the first four months of FY26, implying an even greater increase in the remaining two months of the period.

Revenue per marketing dollar, which highlights the productivity of marketing, was broadly stable in H126 versus H125.

Following a better-than-anticipated gross margin performance, management had warned that FY26 would begin to see gross margin contraction as the tariff-related cost increases fed into the supply chain. The reported gross margin decline of 130bp is better than management had anticipated, as a result of the increase in average order value.

The underlying operating margin decline of 130bp to 9.4% in H126 is consistent with the decline in gross margin, indicating good control of costs on an absolute basis, maintaining them overall relative to revenue.

With the results, management has quantified adjustments related to uncertain tax treatments. Management’s best estimate of one-time costs is c $5.1m. This follows a change to management’s assessment of certain historical income tax positions and a reallocation of payments across jurisdictions. The balance sheet includes a current tax asset of $19.0m and a current tax liability of $19.5m, which we expect to reverse out in FY27. We have included new line items in our financial summary table in Exhibit 4 to show underlying profit figures that exclude these adjusting items.

Our new revenue estimate for FY26 of $1.351bn is broadly in line with management’s updated guidance of slightly above FY25’s $1.35bn as is our adjusted PBT estimate of $129.6m (compared to guidance of ’approximately $130m’).

Management’s guidance implies relatively consistent rates of change in the main KPIs in H226, suggesting upside if the improving trends in orders from new customers continues. The implied average order increase of c 1% in H226 compounds the c 2% growth in H225 to give c 3% growth on a two-year basis, consistent with H126.

FOUR typically reports a lower gross margin in the second half of any financial year due to changes in product mix more heavily weighted towards apparel.

Cash flow and balance sheet

In Exhibit 2 we show a summary of FOUR’s cash generation and uses in absolute terms and relative to revenue.

On a relative basis, the lower profitability, less favourable working capital and higher capital spend weighed on free cash generation in H126 versus H125.

At the period end, FOUR had a cash balance of c $137m with no debt beyond leases of c $3m.

Valuation

In Exhibit 3 we show how FOUR’s prospective EV/sales multiples and operating margins compare with its long-term history. For historical multiples we show the high, average (figure quoted) and low for the year, and we exclude FY20 and FY21 due to the distortion provided by the global COVID pandemic. We also exclude leases from our calculation of enterprise value in order to get a longer-term picture of valuation.

We conclude a recovery in profitability would be supportive of a re-rating.

General disclaimer and copyright

This report has been commissioned by 4imprint Group and prepared and issued by Edison, in consideration of a fee payable by 4imprint Group. Edison Investment Research standard fees are £60,000 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

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