4imprint Group (LSE: FOUR)

Currency in GBP

Last close As at 06/02/2023

GBP45.55

40.00 (0.89%)

Market capitalisation

GBP1,279m

4imprint is the leading direct marketer of promotional products in the United States, Canada, the UK and Ireland. In FY21, 98% of revenues were generated in the United States and Canada.

In some ways 4imprint’s trading reflects the health of the US economy. There will be increasing attention paid to the impact of inflation on customer budgets and the threat of recession, on top of ongoing concerns regarding stock availability and cost inflation for both stock and staff. However, these are factored into the numbers (as much as is sensible currently). The US promotional products distribution market is highly fragmented and PPAI estimated its value in 2022 at over US$25bn, up 13% on the year.

Sector

TMT

Equity Analyst

Fiona Orford-Williams

Fiona Orford-Williams

Director, TMT

Key Management

  • David Seekings

    FD

  • Kevin Lyons-Tarr

    CEO

Balance Sheet

Forecast net cash (US$m)

86.7

Forecast gearing ratio (%)

N/A

Share Price Performance

Price Performance
% 1M 3M 12M
Actual 7.8 26.0 67.6
Relative 2.1 14.5 65.9
52 week high/low 4705.0p/2240.0p

Financials

4imprint’s update shows the group continuing to trade strongly through Q422 and we have again upgraded estimates. FY22 revenue will be 3% ahead of our earlier modelling at $1.14bn, 45% ahead of prior year. An 8.8% adjusted operating margin compares with our earlier assumption of 8.2%. We edge revenue forecasts up by 3% for FY23 and FY24 but assume some modest settling back in margin to reflect additional operating costs to support the increased scale of the business. As before, we suggest management may propose a FY22 special dividend, given net cash of $86.7m at the year-end.

Y/E Dec Revenue (US$m) EBITDA (US$m) PBT (US$m) EPS (fd) (c) P/E (x) P/CF (x)
2020A 560.0 8.9 3.8 11.0 510.0 95.4
2021A 787.3 35.7 30.2 80.3 69.9 69.0
2022E 1140.0 105.9 100.7 272.0 20.6 15.1
2023E 1250.0 111.3 106.0 286.0 19.6 14.8

Thematics

Digital Marketing and Internet Media Technology Platform

TMT

MediaWatch – January 2023

Consumer

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