Take a look at the timeline running along the bottom of this page. Using the formation of Polestar in 1998 as our starting point, it’s clear there has been a monumental amount of change in UK publication, gravure and commercial web offset printing over the past decade and a bit.

While last week’s events revolved around web offset, the two new gravure plants built here have played their part too – a number of large contracts including the Associated Newspapers and Telegraph Group supplements migrated from web offset printing to gravure as a result.

But while gravure is a Europe-wide playing field, web offset mainly caters for local markets, and thanks to a series of fairly incredible events – including a rush to purchase 64/72pp machines that created a massive influx in capacity – it’s been a buyer’s market for more than a decade.

More for less
Back in 2002 then-Cooper Clegg chairman Ian Cooper said he thought that web offset was in its worst shape for 30 years. "We are doing more work for the same money," he lamented at the time.

In the intervening years, the situation has only worsened, and printers are now routinely doing more work for less money. With one or two notable exceptions, the web offset sector overall is losing money, with gallons of red ink splashed by the industry’s biggest players in particular.

The smoke signals coming out of St Ives have been pretty clear as it closed down a succession of web plants and focused its attention on investments away from commodity print. Last week this prolonged contraction reached its conclusion as the group confirmed it was offloading its loss-making magazine business to Walstead Investments for £20m.  

For some customers the news has come as an unpleasant shock. "The pigeons have come home to roost," observes one buyer who prefers to remain anonymous. "People may well say that the publishers are getting what they deserve, although printers have never been any good at saying ‘that’s enough, we’re not going to match or undercut that price’, and of course buyers have used that to their advantage."

Wyndeham Press Group chief executive Paul Utting will soon be running a much bigger group if, as expected, St Ives shareholders approve the sell-off of its magazine wing. He believes the situation cannot continue: "The need for consolidation has accelerated," he says. "Unlike most manufacturing industries our sector is almost entirely loss-making. To compound this position we are facing ongoing raw material prices rises of between 20% and 40%, and these are huge increases which we cannot simply absorb."

Ongoing plans
The £20m price tag for a debt-free business with assets of some £35m looks like a snip, but St Ives has spent £6.4m in the past two years on restructuring costs across the operations, which still lost money at operating level. "Yes we are buying excellent and well-maintained assets, but we will need to make changes to restore the business to profitability," Utting points out.

Some clues as to the possible nature of these changes come in the lease agreements between Wyndeham owner Walstead and St Ives for the three sites: the Peterborough lease is for 10 years with a break clause after five; whereas the Roche and Plymouth leases are both for only one year initially, with an option to extend.

Utting’s message to customers is this: "We are hugely committed to this sector – web offset is our core business as we’ve demonstrated by our last four acquisitions," he states. "I believe we have an excellent management team, are the best-invested, and mostly strongly backed [with funding from RBS] player in this market and we are now the market leader. The trading conditions will be very challenging over the next year or two, but I also believe that given the strengths I have described we are the most sustainable supplier. We are keen to reach long-term agreements that provide publishers and other print buyers with a robust critical supply chain partnership through this difficult period."

So how much will prices need to go up by? Utting laughs and answers enigmatically: "There are a number of strategic choices we need to make."

TIMELINE
1998 • BPC and Watmoughs merge to form Polestar in an £810m deal

2001 June • Duncan Web Offset closes August • Centre Web goes bust, assets bought by York Mailing

2002 February • St Ives Gillingham closure announced March • Polestar Chromoworks saved from closure by last-minute deal June • Polestar shuts down two presses at Watmoughs Idle October • Howitt managing director James Elliot announces plans for gravure superplant

2003
December • Polestar Watford closure announced • Polestar announces plans for greenfield gravure site

2004
February • WE Berry closes • James Elliot’s gravure plant plans collapse • MBI at Jarrold Printing creates New Jarrold Printing March • TPL closes • Polestar Anglia closes June • New Jarrold Printing plans greenfield site • Gask & Hawley buys JCM Media July • Philip Myers buys Neston Colour out of administration • Polestar East Kilbride closes

2005
February • St Ives Caerphilly to close April • St Ives sells loss-making German web offset business • Prinovis says it will print runs as low as 200,000 at its new Liverpool gravure site • Production begins at Polestar Sheffield September • Polestar Purnell to close by end of year November • New Jarrold Printing insists £40m superplant plans are on track

2006
April • Cradley Print closes July • Production begins at Prinovis Liverpool August • New Jarrold Printing in administration • Pillans & Waddies closes November • Dagsbrún puts Wyndeham up for sale December • Polestar refinancing results in £700m write-off for investors

2007
January • BGP Colchester to close • Dagsbrún sells Wyndeham to Icelandic investors March • BGP plans £25m investment in Bicester supersite • Pindar buys Cooper Clegg June • Graphoprint ceases trading

2008
January • Closure plans announced for Polestar Greaves • Quebecor World goes into Chapter 11 bankruptcy protection
February • Quebecor World Corby closes June • Trader Media closes Wiltshire November • Pindar sells Cooper Clegg, deal is backed by the same investors who own Walstead September • Wyndeham’s Icelandic backers collapse December • Walstead Investments buys Wyndeham Press Group

2009
January • Cooper Clegg closes April • Trader Media scales back Apple Web Offset business February • Century Web Offset closes May • St Ives Andover to close July • Walstead Investments buys Southernprint September • Trader Media sells Acorn Web Offset to Garnett Dickinson •APS Group buys Philip Myers Press out of administration

2010
April • Ex-Graphoprint staff form Grapho Media May • St Ives Edenbridge closure announced • G&H Web Offset in administration June • TPF Round Spinney closed October • Polestar Varnicoat to be downsized to single press November • Walstead Investments buys Apple Web Offset • Walstead announces plans to scale back operations at Southernprint

2011
February • Journal Print ceases ?trading March • Walstead Investments buys St Ives Web for £20m