Still Going Strong
It's coming up to a year since I started this blog, and some of the companies included in my original portfolio have more or less stayed there without further discussion. Much of this is for good reason - there just isn't much interesting to say - but Annual Reports seem to provide a good time to endeavour to refresh your analysis of the company and bring yourself up to date with things once again. It's an idea I stole off Richard Beddard that'll hopefully see me not fussing too much about small price movements and provide a timely update on how things are going with the companies I part-own.
Communisis doesn't exactly fit that category. First there was the to-ing and fro-ing about its inclusion, and then came a rather sharp and unexpected price move that had me wondering whether I should be reconsidering its position - it had risen about 60%. I decided back then to wait for the annual reports to reappraise things, and so here we are - they were published yesterday.
Having read them, though, they get a resounding vote of normality. Revenues and profits came pretty much in line with expectations, exceptional costs continue to drive down the reported figures with adjusted figures rising (I use adjusted figures in the graph) and margins continue to creep up to the management's long term target of 10%. Recently, they also announced a rather large investment project - another £10m on state of the art printing equipment - to ensure they keep their competitive advantage and enjoy the high margin, differentiated business vs. the bulk mailing they may have been associated with. (more…)