Last close As at 05/08/2026
GBP50.00
▲ 110.00 (2.25%)
Market capitalisation
GBP1,378m
Research: TMT
4imprint’s AGM trading update indicates a solid start to the year against a challenging market backdrop, with full-year expectations (and therefore our forecasts) unchanged. Group revenue growth of 6% over the prior year for the four months to end April is clearly ahead of the North American market, where Q124 industry revenue indications range from broadly flat to a small decline, indicating that the group is continuing to build market share. 4imprint is the largest distributor in North America, yet still only has a market share of around 5%, giving plenty of further runway for growth. CFO David Seekings has announced his intention to retire before the end of 2025, giving ample time for a suitable succession to be arranged.
4imprint Group |
Solid start to the year |
AGM update |
Media |
22 May 2024 |
Share price performance
Business description
Next events
Analysts
4imprint Group is a research client of Edison Investment Research Limited |
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4imprint’s AGM trading update indicates a solid start to the year against a challenging market backdrop, with full-year expectations (and therefore our forecasts) unchanged. Group revenue growth of 6% over the prior year for the four months to end April is clearly ahead of the North American market, where Q124 industry revenue indications range from broadly flat to a small decline, indicating that the group is continuing to build market share. 4imprint is the largest distributor in North America, yet still only has a market share of around 5%, giving plenty of further runway for growth. CFO David Seekings has announced his intention to retire before the end of 2025, giving ample time for a suitable succession to be arranged.
Year end |
Revenue |
PBT* |
EPS* |
DPS** |
P/E |
Yield |
12/22 |
1,140 |
103.7 |
285.6 |
160.0 |
27.6 |
2.0 |
12/23 |
1,327 |
140.7 |
377.9 |
215.0 |
20.9 |
2.7 |
12/24e |
1,430 |
146.5 |
395.2 |
225.0 |
19.9 |
2.9 |
12/25e |
1,500 |
153.8 |
408.7 |
232.5 |
19.3 |
3.0 |
Note: *PBT and EPS (fully diluted) are normalised, excluding amortisation of acquired intangibles and exceptional items. **Excluding special dividends.
Orders ahead, outperforming the market
The AGM update highlights order intake up by 4% in the four months to end April over the prior year, with average order value up by 2%, which is a strong performance when measured against the US economy, which grew by 1.6% in the first quarter. The two industry bodies, the Advertising Specialty Institute and Promotional Products Association International, have reported Q124 distributor sales down 0.9% and up 1.5% respectively, reflecting their differing methodologies. Group orders in H223 were up by 7%, so there has been some softening of the market reflecting the economic backdrop. Clearly, though, 4imprint is outperforming its market.
Profitability remains good
The brief statement also outlines that gross margins continue to be strong, which we take to mean running at or around 30%. It also highlights the increased degree of flexibility in the marketing, with the ability to target more effectively and efficiently, particularly when compared with traditional routes. Operating margins look to us to be sustainable at the 10% level without compromise on the investment needed to support growth. This includes the $20m project to expand the Oshkosh distribution centre, on track to complete in H223 and illustrated in this video.
Valuation: Supported by DCF
The share price has continued to recover from the effect of earlier supply chain issues and is now up 38% year to date and up 26% over one year. A discounted cash flow (WACC of 9%, terminal growth of 3%, as before) generates an implied value of £61.18, from £60.31 at the time of our March update note when the US$/£ rate was 1.278 (now 1.271), giving strong support for the current price.
Exhibit 1: Financial summary
$000s |
2021 |
2022 |
2023 |
2024e |
2025e |
||
Year end 31 December |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
||
PROFIT & LOSS |
|||||||
Revenue |
|
|
787,322 |
1,140,286 |
1,326,500 |
1,430,000 |
1,500,000 |
Cost of Sales |
(561,306) |
(818,670) |
(924,600) |
(996,710) |
(1,047,000) |
||
Gross Profit |
226,016 |
321,616 |
401,900 |
433,290 |
453,000 |
||
EBITDA |
|
|
35,660 |
108,428 |
142,600 |
149,900 |
157,000 |
Operating profit (before amort. and excepts.) |
|
|
30,646 |
102,902 |
136,200 |
143,000 |
150,000 |
Intangible Amortisation |
0 |
0 |
0 |
0 |
0 |
||
Exceptionals |
0 |
0 |
0 |
0 |
0 |
||
Pensions and share options |
(602) |
(815) |
(1,100) |
(1,400) |
(1,400) |
||
Operating Profit |
30,646 |
102,902 |
136,200 |
143,000 |
150,000 |
||
Net Interest |
(417) |
804 |
4,475 |
3,500 |
3,800 |
||
Net pension finance charge |
0 |
0 |
0 |
0 |
0 |
||
Profit Before Tax (norm) |
|
|
30,229 |
103,706 |
140,675 |
146,500 |
153,800 |
Profit Before Tax (IFRS) |
|
|
30,229 |
103,706 |
140,675 |
146,500 |
153,800 |
Tax |
(7,643) |
(23,563) |
(34,497) |
(36,625) |
(38,450) |
||
Profit After Tax (norm) |
22,586 |
80,143 |
106,177 |
109,875 |
115,350 |
||
Profit After Tax (IFRS) |
22,586 |
80,143 |
106,177 |
109,875 |
115,350 |
||
Discontinued businesses |
0 |
0 |
0 |
0 |
0 |
||
Net income (norm) |
|
|
22,586 |
80,143 |
106,262 |
111,340 |
115,350 |
Net income (IFRS) |
|
|
22,586 |
80,143 |
104,377 |
109,875 |
115,350 |
Average Number of Shares Outstanding (m) |
28.1 |
28.1 |
28.1 |
28.2 |
28.2 |
||
EPS - normalised fully diluted (c) |
|
|
80.3 |
285.6 |
377.9 |
395.2 |
408.7 |
EPS - (IFRS) (c) |
|
|
80.5 |
285.0 |
377.0 |
395.1 |
408.6 |
Dividend per share (c) |
45.0 |
160.0 |
215.0 |
225.0 |
232.5 |
||
Special dividend per share (c) |
0.0 |
200.0 |
0.0 |
0.0 |
(0.0) |
||
Gross Margin (%) |
28.7 |
28.2 |
30.3 |
30.3 |
30.2 |
||
EBITDA Margin (%) |
4.5 |
9.5 |
10.8 |
10.5 |
10.5 |
||
Operating Margin (before GW and except.) (%) |
3.9 |
9.0 |
10.3 |
10.0 |
10.0 |
||
BALANCE SHEET |
|||||||
Fixed Assets |
|
|
40,011 |
47,940 |
51,400 |
65,100 |
67,334 |
Intangible Assets |
0 |
1,010 |
1,010 |
1,010 |
1,010 |
||
Other intangible assets |
1,045 |
957 |
490 |
490 |
490 |
||
Tangible Assets |
24,667 |
29,255 |
34,700 |
49,900 |
52,900 |
||
Right of use assets |
11,725 |
13,103 |
11,400 |
9,900 |
9,900 |
||
Deferred tax assets |
600 |
2,381 |
3,800 |
3,800 |
3,034 |
||
Retirement benefit asset |
|
|
1,974 |
1,234 |
0 |
0 |
0 |
Current Assets |
|
|
127,771 |
192,353 |
186,900 |
215,566 |
272,299 |
Stocks |
20,559 |
18,090 |
13,600 |
14,954 |
15,373 |
||
Debtors |
63,589 |
87,511 |
68,400 |
75,212 |
76,527 |
||
Cash and short-term deposits |
41,589 |
86,752 |
104,500 |
125,000 |
180,000 |
||
Other |
2,034 |
0 |
400 |
400 |
400 |
||
Current Liabilities |
|
|
(73,027) |
(87,401) |
(91,280) |
(96,256) |
(98,813) |
Creditors |
(71,877) |
(85,966) |
(89,900) |
(94,976) |
(97,633) |
||
Short term borrowings |
0 |
0 |
0 |
0 |
0 |
||
Lease liabilities |
(1,150) |
(1,435) |
(1,380) |
(1,280) |
(1,180) |
||
Long-Term liabilities |
|
|
(11,789) |
(12,672) |
(12,520) |
(11,320) |
(10,078) |
Long-term borrowings |
0 |
0 |
0 |
0 |
0 |
||
Lease liabilities |
(10,939) |
(12,315) |
(10,920) |
(9,720) |
(9,720) |
||
Other long-term liabilities |
(850) |
(357) |
(1,600) |
(1,600) |
(358) |
||
Net Assets |
|
|
82,966 |
140,220 |
134,500 |
173,090 |
230,742 |
CASH FLOW |
|||||||
Operating Cash Flow |
|
|
22,846 |
101,317 |
166,900 |
135,554 |
162,889 |
Net Interest |
(409) |
699 |
3,900 |
3,500 |
3,800 |
||
Tax |
(6,414) |
(20,755) |
(33,800) |
(32,660) |
(35,950) |
||
Capex |
(3,465) |
(8,011) |
(9,700) |
(22,100) |
(10,000) |
||
Acquisitions/disposals |
0 |
(1,700) |
0 |
0 |
0 |
||
Pension contributions |
(4,589) |
(4,367) |
(6,500) |
0 |
0 |
||
Financing |
(843) |
(866) |
2,500 |
(900) |
(900) |
||
Dividends |
(4,134) |
(18,722) |
(110,800) |
(61,691) |
(64,283) |
||
Other/ Capital portion of lease repayments |
(1,117) |
(2,432) |
5,250 |
(1,200) |
(500) |
||
Net Cash Flow |
1,875 |
45,163 |
17,750 |
20,503 |
55,056 |
||
Opening net debt/(cash and short-term deposits) |
|
|
(39,766) |
(41,589) |
(86,752) |
(104,500) |
(125,000) |
Net impact of disposals etc |
0 |
0 |
0 |
0 |
0 |
||
Other |
(53) |
0 |
(2) |
(4) |
(56) |
||
Closing net debt/(cash) |
|
|
(41,589) |
(86,752) |
(104,500) |
(125,000) |
(180,000) |
Source: Company accounts, Edison Investment Research
|
|
Research: Industrials
Dowlais Group’s traditional automotive and powder metallurgy operations continue to outperform the market, albeit the slowdown in EV adoption has affected ePowertrain, leading to a marginal reduction in expectations. However, the key remains further progress in operating margins (6.1% in the period, up 30bp) on the journey to c 10%. This margin expansion should drive earnings momentum and subsequently share price performance.