4imprint Group plc (LON:FOUR) has provided a further update on the effect of the COVID-19 pandemic on the Group’s trading and operations.
In our last COVID-19 update issued on 7 April 2020, we noted that the spread of the pandemic and associated ‘Safer at Home’ or similar directives had resulted in order counts reducing to about 20% of prior year level. As the partial or full lifting of these restrictions began in many US states in May and early June, weekly order counts have steadily increased and are now approaching 50% of the 2019 comparative. Importantly, we continue to acquire new customers and the new-to-existing customer ratio has remained broadly stable over this period.
Since the beginning of the pandemic, we have continued to provide excellent service to our customers through an expanded ‘work from home’ capability. Our two US locations in Oshkosh, Wisconsin and our office in Manchester, UK have now reopened. Where practical, however, team members continue to work from home, allowing us to implement robust social distancing protocols in our facilities. In line with our culture, the health, safety and wellbeing of our people remains our top priority, and we have continued to prioritise the retention of our team members throughout this difficult period. Our team is ready and very motivated to service the recovering demand that we are seeing.
Cash conservation was a clear focus for the Group early in the COVID-19 crisis. Action has been taken to control discretionary and capital spend. We executed a thoughtful and effective recalibration of the marketing strategy to significantly decrease marketing investment throughout the period yet stay connected with our existing customers and maintain our brand awareness. This strategy has also given us the flexibility to ramp up the marketing as justified by market conditions.
The Group’s balance sheet and liquidity position remain strong. At the end of May 2020, the Group had cash balances of $28.1m, and no debt. This is after the payment in May of the $9.4m planned lump sum contribution to the Group’s defined benefit pension plan. We also have a working capital facility of $20m.
4imprint Group intends to announce its half year results for the 26 weeks ended 27 June 2020 on Thursday 13 August 2020. In the meantime, the Board remains confident in 4imprint’s strategy, business model and market position, culminating in the delivery of longer-term value for all stakeholders.
