In the six months to 30 June the group posted sales on continuing operations up 5% to £27.45m, while pre-tax profits jumped from £780,000 to £6.22m.
Writtle made a profit of £5.13m when it sold Creo to DS Smith in June.
Chairman Robert Essex described the period as “an eventful six months”. The group’s unsuccessful bid for Tangent Communications involved £120,000 of expenses, but Essex said there had been a benefit because Writtle’s profile had been raised as a result. The company remains on the lookout for suitable acquisitions and is targeting firms with suitable synergies and sales of more than £10m.
“There are any number of small businesses on the market at the moment, but we are still looking for the larger transformational deal which might facilitate an IPO,” he explained.
He said Writtle did not yet have the necessary scale to benefit from a flotation.
There was a mixed picture within the results. Its agency businesses were adversely impacted by a “sharp slowdown” around the time of the EU referendum, but pre-media specialist Magnet Harlequin grew market share and point-of-purchase operation Arken expanded into a new factory in Sandy.
“A number of our design and innovation agencies, like Seymour Powell, were hit by corporate indecision in the run up to and post-Brexit. A number of big decisions were put on hold. There are signs that things are thawing but it is early days,” Essex said.
“The Magnet Harlequin Group, which includes Technik and our Far East operations are benefiting from an investment in technology over the past few years. They offer clients a faster and more cost effective ‘design to shelf’ full service, and they have increased market share.”
Writtle had £6.53m in cash at the half-year, and Essex said the group’s strong balance sheet provided “the potential for further start-ups or acquisitions” as well as growing dividend returns for shareholders.
The group’s private equity shareholders, ABRY Partners and Veronis Suhler Stevenson, each have a 14% stake in the business and will sell a third of their shares every year for the next three years, as part of an arrangement agreed when Writtle acquired Loewy Group five years ago.
