March 15 (Bloomberg) -- St. Ives Plc, a U.K. printing company, lost money in its fiscal first half because of a write-down for an unprofitable magazine printing unit. The stock fell the most in two months.
The net loss in the 26 weeks to Jan. 28 was 10.3 million pounds ($16.6 million) after a profit of 6.7 million pounds in the year-earlier period, the London-based company said in a Regulatory News Service statement today. Sales fell 1 percent to 149.4 million pounds.
St. Ives said yesterday that it’s agreed to sell its magazine-printing business, whose clients include Time Out, Vogue and the Economist, to Walstead Newco3 Ltd. for 20 million pounds. The total first-half loss from discontinued operations, which includes this unit, widened to 19.2 million pounds, from 1.18 million pounds a year earlier.
“We do not see an immediate improvement in the general economic climate in this financial year and there remain some significant structural and cyclical challenges,” Chief Executive Patrick Martell said in the statement. “The proposed disposal of the loss-making magazine printing business will further strengthen the group’s financial performance.”
The stock fell 3.2 percent to 105 pence at the 4:30 p.m. close in London trading today, the biggest loss since Jan. 12.
The British printer which gets about 80 percent of its profit from the printing business, plans to hire more sales staff this year and keep costs down to boost profitability, Martell said in a phone interview today.
“We are certainly planning to meet market forecasts for this year,” Martell said, “We will continue to look at our costs.” Martell said 2011 pretax profit market was seen by analysts at 21 million pounds.
St. Ives will be “debt-free” by the end of this fiscal year through “tight control of working capital and capital expenditure,” Finance Director Matt Armitage said in the same interview. Net debt was 2.2 million pounds, the company said.
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