Industrial and retail ink-jet printer manufacturer Domino Printing Sciences Plc of Cambridge, England, was full of promises as it reported a further profit decline for the year ending October 31 yesterday. A mixture of lowered interest receivable, a delayed product launch and downturns in German and American profits conspired to slash pre-tax group profits by 24.1% to UKP9.1m, on turnover up 14%. As a result, it has reduced its headcount by roughly 11% to 800 worldwide. The firm, which has seen profit margins slip by 3.3% overall, experienced a 51.1% decline in profits on flat turnover in real terms from its US operations, putting this down to a slower than expected growth in the US economy. This is particularly hard to swallow after the increased investment that it vowed to make throughout 1993. The firm has retained its sales and marketing staff in the US, but has whittled away staff from other US areas; about 25% of headcount reductions were made in the US, saving UKP750,000 according to group managing director Howard Whitesmith. The German operation saw a downturn in profit of UKP700,000 in the year, prompting Domino to sell German distribution rights to its Swiss distributor on October 31. Most of the staff from the German operation went to the Swiss operations, but three redundancies in Germany cost the group UKP150,000. The firm still owns the German building and leases it to the Swiss, but after they move into the Swiss company’s German offices, Domino may sell the building. In total, UKP3.6m has been set aside for restructuring costs. Domino’s mimeographic printer operation, Domino Packtrack, failed to achieve profitability in the year despite the promise that it would in last time’s year-end announcements. In fact, a late product launch and a management team which has since been replaced meant that losses grew to $1.1m this time from UKP492,000 last time. Whitesmith said that the business will see profitability this year: already it has sold more of the new Packtrack 3000 product in the first quarter than it sold of the Packtrack 2000 unit in the whole of last year. The group also lost UKP650,000 due to reduced interest on its cash deposits. It is still looking for the right company to acquire with the UKP16.5m net in the bank, and the lower interest rates make this more urgent, as raw cash doesn’t grow as quickly it used to in the UK. It has also been shopping, buying a freehold on its US headquarters and a new research and development facility in Cambridge. It is still growing in the Middle and Far East, though, gaining 27% and 17% of business there in the past year.
