Communisis secures bank deal as markets continue to lag

PRINTING and marketing communication group Communisis today said pressures on its markets had continued into the second half of the year and had not been helped by postal strikes.

But the Leeds-based group said its strategy of focusing on cross-selling its products to existing customers had been “encouraging” during the third quarter of the year.

In a third quarter interim management statement covering the three months to the end of September, the company said that “visibility of future orders remains difficult”.

It confirmed it had successfully renewed its bank facilities with KBC Bank, increasing it to £10m and which will be due for repayment in February 2012.

Communisis said that forecast debt at the end of this year will remain “broadly comparable” to the £25m it stood at at the end of June. The group has overall committed debt facilities of £50m.

In its statement Communisis said: “Demand for our technology and services offering continues to be strong and increased activity levels are being sustained in this business.

“The transactional print division continues to perform in line with our expectations.  As we said in August, we are not yet seeing the return of rebranding and other project work and the overall market for promotional cheque mailshots continues to decline.

“The direct mail business remains our biggest challenge. The recovery in volume that we saw towards the end of the first half continued in Q3, but with no significant improvement yet in the volume of higher value personalised mailings and continued margin pressure.  The uncertainties at Royal Mail have not helped our clients’ campaign planning.”