Print firm warns of job losses in ‘old’ markets

The company was heavily involved in mobile phone operator EE’s new 4G high-speed network launch, the first of its kind in the UK.

Communisis worked on direct mail, internal communications and marketing material for the campaign and across EE’s entire 700-store estate.

“All the stuff you see in there is as a result of our solution,” said chief executive Andy Blundell. “It’s been so successful it’s created quite a lot of work.

“We’ve got a strong footprint in telecoms generally; it’s quite an interesting area for us.”

Communisis said its forecast for full-year earnings remains unchanged, and it expects a third consecutive year of “significant growth”.

However, the company revealed it is closing a cheque personalisation plant in Lisburn, Northern Ireland, with the loss of 46 jobs. Communisis is also cutting back further at its Leeds direct mail plant, where it is consulting over 16 job cuts from a total 375-strong workforce.

“In cheques we’ve got a market decline there of eight to 10 per cent a year,” said Mr Blundell, adding other mature markets include some aspects of paper-based statements and direct mail.

“The days of ‘Dear Householder’ are probably gone. But the offset is coming on two fronts – our move towards all-colour digital and we’re grabbing more marketing share and the more specialised end of direct mail.”

Communisis also restructured in Leeds in 2009 as recession, meltdown in the financial sector and a sharp fall in bank marketing hammered profits and sales and forced it to cut jobs.

However, it has since installed high-speed colour digital print lines in its Leeds and Liverpool plants.

Mr Blundell said the Leeds direct mail plant is “trading well and we do expect to get a positive financial result this year”. “But this is an element of looking ahead”, he added. “It’s becoming more specialised.”

The company added: “In overall terms, we expect the annualised value of new business to more than offset the reduction in demand for more mature products.

“We continue to manage our cost base in line with market developments so as to maintain our competitiveness and margins.”

The cost cuts will be implemented in January. Communisis has booked an exceptional charge of £1.5m, which will be reflected in the results for the second half. The annual cost savings are estimated to be £1.3m.

“Overall, our headcount across the group is positive,” said Mr Blundell.

The company also revealed it has moved its headquarters to London, but retains its registered office in Leeds.

It expanded in London last year and this summer bought half of London-based marketing agency The Garden Marketing Limited. Mr Blundell said Communisis remains committed to Yorkshire.

“We’re one of the most important plcs left in the region,” he said. “There’s a lot of heritage with us in Leeds and it’s an important part of the group.”

He added: “The focus at Communisis continues to be the successful pursuit of profitable growth.

“We are building our reputation as the trusted partner for the provision of customer communication services and in this context are pleased with the interest being shown by a number of major brands in the strength of our market leading propositions, especially for transactional documents, and look forward to announcing further new multi-year contract awards in the near future.”

At the cutting edge

Communisis said it is at the forefront of high-speed colour digital printing following the installation of state-of-the-art printers in Leeds and Liverpool.

In Leeds the printers play a major role in Communisis’ direct mail operations.

The banking crisis and an increase in regulation to prevent further bank scandals is changing the way financial products are sold to customers. This means direct mail shots become more personalised. “Increasingly these financial companies are trying to isolate an individual consumer,” said Communisis chief executive Andy Blundell. “They want to retain that individual relationship.”

In addition, anger about the rising costs of gas, electricity and water means that utility customers are demanding a more honest conversation with their providers.