The move comes less than six months after Ovation's purchase of Branch-Smith Printing and the two printers have quickly been combined into a single operation with more than $30 million in annual sales.
Daniel Hanson, formerly president of Branch-Smith, who now takes over as head of the merged operations told PrintWeek that Branch-Smith had traditionally specialized in short-run (5,000 or less) books, manuals and other bound products. "Motheral traditionally worked on 20,000 print runs, but more recently it’s been around 15,000, so this gives us a chance to serve both the long and short end of the same market," he added.
As part of the acquisition, Ovation-Branch-Smith is moving all of its equipment out of its 68,000 sq. ft. Fort Worth facility and into Motheral’s 150,000 sq. ft. plant, enabling it to significantly reduce expenses.
"It both strengthens our market positions and really allows us to collapse costs," Hanson noted, adding that Motheral has two web presses--a 16 page press and a 32-page KBA Compacta, while Branch-Smith has a 32-page large format sheetfed KBA. "This solves the critical mass problem while allowing us to get rid of an extra facility and extra utilities—we’ve already found some immediate savings in just the first week."
Hanson added the move also boosts their national platform, noting, "Our reps that travel the country are excited because it’s going to give us a longer reach for many of those national markets."
Like many commercial printers, Motheral--founded 78 years ago--had seen its business erode recently, which triggered the decision to sell. "They were in a distressed financial situation, their volumes had dropped, but they’re still a substantial company," explained Hanson, who added that Motheral has been projecting flat sales this year before the acquisition.
As for his overall business, Hanson said, "We had a much better May than we did for the first part of the year, so we see our sales fly-wheel improving. The combined increased volumes and getting rid of the excess costs should enable us to give us a good, strong profitable company. We’re keeping all the sales people and there’s very little account crossover, because they worked with the long run publishers and they worked the short run so the reps are really excited."
Ovation may not be done with its current consolidation binge as Hanson noted there is already some discussion underway about moving Irving, TX-based Ussery Printing, another Ovation company, into Motheral’s large Fort Worth facility at some point in 2013. "Like a lot of commercial printers, we’re looking to get rid of extra assets and by combining the operations of the three companies, we’ll be a lot more efficient while producing the same volume," he noted.
