Domino Printing Sciences Plc says its rise in profits for the year to October 31 is the direct result of maintaining product margins, and of increasing sales levels without significantly increasing inventory levels. In the UK and Europe, the industrial ink jet printer manufacturer boasts a return on sales of approximately 32%, and about 13% in the US. Pre-tax profits rose 32.3% to UKP11.9m, while turnover increased 18.6% to UKP71.6m. The results were in line with the group’s expectations, and the board has proposed a final dividend of 4.80 pence compared with 4.15 pence last time, making 7.20 pence for the year, up 95 pence on 1991. Despite having invested some of its UKP15.3m rights issue (CI No 1,767) in purchasing property, managing director Howard Whitesmith said that the group still has adequate cash for acquisitions. He is interested in technology products or companies that have an established customer base in Domino’s main markets: the commercial sector; companies dealing in foodstuffs; dairy products; pharmaceuticals; building, and electronics. Although the firm found no suitable candidates, market research and professional fees cost it UKP192,000. This was charged to the profit and loss account. Cash from the share issue was also spent on buying the freehold on its Chicago premises for UKP5.1m; purchasing a building adjacent to its Cambridge headquarters for UKP850,000; building a new site in Wiesbaden to service Germany and Eastern Europe; and investing in a new site in Guildford for its July 1991 acquisition (CI No 1,727) – the Domino PackTrack mimeographic printer design and manufacturing operation. Although this made a loss of UKP492,000 this year, PackTrack is expected to become profitable in 1993. Another aim for the coming year is to increase volume sales from the company’s US plant. It has already doubled its workforce from 15 to 26, adding to management and sales teams, and has increased market share from between 13% and 14% to between 17% and 18%, despite ‘a sluggish economy’. Conversely, European sales slowed, Whitesmith said, ‘reflecting the more severe economic circumstances’ in these countries. But, because the group now generates about 84% of its total turnover outside of the UK, he believes the devaluation of sterling will work to Domino’s advantage. Especially in Europe, where the company hopes to take advantage of the reorganisation and redundancy programme announced by its French competitor, Image SA. Domino now does business in about 70 countries. Approximately 75% of its revenues are generated by direct sales to the UK, US, Spain, France, Germany and the Netherlands. The remainder comes in from its distributors in over 60 other countries. Whitesmith expects sales in such regions as Germany and Japan to slow in 1993, but is confident of prospects in the Middle and Far East. He also has a number of new products and enhancements in the pipeline, which he feels will further strengthen the group’s international position.
