Grafenia expects revenue to fall in short term

GRAFENIA, the AIM print and website design firm company previously called Printing.com, has reported a fall in earnings and revenue, but pick-up in bottom-line profits.

The group, which is headquartered in Trafford Park, is in a transitional phase as its small bsuiness customer base focus more on e-commerce and less on buying printed promotional material.

Reflecting its shift away from print, revenues in the year to March 31 were down 13% to £17m. EBITDA was down  5% at £2.52m, while pre-tax profits rose 13.2% to £860,000.

Looking ahead the business said it would continue to focus on Nettl – a high street web design studio brand, and Marquetspace which is  a low-cost, online service targeting trade buyers of printing service.

Grafenia said Marqetspace had generated an annualised monthly run rate (AMRR) of revenue in excess of £1m during March 2015, and Nettl by the same point had secured 25 outlets / partners, including a number of former Printing.com stores that have been converted to the new format.

Chairman Les Wheatley said: “During the current year, as the nature of our Printing.com franchise partners’ businesses change and with our Dutch markets likely to be increasingly competitive it is probable that we will continue to see revenue contract.

“However, with the advent of Marqetspace and Nettl we consider that we have moved beyond the foundations simply being in place.  Each of these channels will, we believe, grow to a material size during the current year and form the mainstay of the group’s revenues over a two to three year timescale.

“Given the change in our markets, and the focus on establishing Marqetspace and Nettl, it is anticipated that earnings for the current year will be weighted towards the second half as expected.  However, by the close of the year we believe the potential of these two channels will have been validated.”