Iffy-looking recent trading put promotional products firm 4imprint (FOUR) in a spin on Tuesday, with the stock slumping 14.5% to £22.99.
Unsurprisingly, the company reported a plunge in annual profit after the pandemic hurt demand for promotional products and orders. For the 53 weeks ended 2 January 2021, pre-tax profit fell 93% to $3.8 million as revenue slipped 35% to $560 million. Net cash was $40 million.
The company said it had seen a recovery from the second half of the year and a robust fourth quarter.
RECOVERY STALLS AT START OF 2021
In the first two months of 2021, order activity was lower, though it had improved in recent weeks.
‘Order counts in January and February 2021 were 65% of 2019 levels, reflecting typically lower order activity at the start of the year combined with volatility caused by news flow and weather events in our primary US market,’ the company said.
‘In the past three weeks, there has been a marked increase in trading momentum, with order intake compared to 2019 approaching the 70% seen in the fourth quarter of 2020,’ it added.
FinnCap analyst Guy Hewett commented: ‘We have made no major changes to our forecasts (EPS edges up due to tax) and reiterate our view that while the timing and pace of a recovery is very hard to predict, 4imprint will accelerate market share gains as it has done after previous downturns and profits will return to pre-Covid levels in 2023.’
