Wellcom wins again

Another year, another double-digit profit and sales boost for Wellcom with big clients wins and further overseas expansion.

The pre-media and print management company increased profits by 14 per cent for the 2015 financial year to $9.76m, with a 28 per cent net revenue jump to $115.4m and statutory revenue increase of 37 per cent to $85.9m.

The about $29.5m revenue difference consisted of print management pass through costs, 8.5 per cent more than FY14, while EBITDA was up 24 per cent to $16m.

[Related: More print management news]

Chief executive Wayne Sidwell says the good times will continue to roll, predicting 10 per cent growth in earning per share for this financial year from the new contracts, organic growth, and new acquisitions.

Revenue from Australasian operations increased 12.1 per cent to $53m, led by new content creation business wins in Australia with Stockland, Kmart, Target, and Super Cheap Auto. Australia contributes about 95 per cent of revenue in the region.

However, the new business wins are not as profitable, with margin falling from 25.4 per cent to 23.5 per cent, with only a four per cent profit increase to $12.48m.

This was the same in other markets with overall margin down from 21.2 to 19.5 per cent, particularly in the UK with ‘absorption costs form new business wins’. British margins are expected to improve next year.

The Australasian operation added 18 new jobs, 16 of which are in Australia to service its newly-won clients, several being photographers.

Its Malaysian Centre of Excellence, where it says it is “leveraging low cost production”, has added two new staff, while the new Hong Kong office has just been set up and has no staff in it yet as the company is still sourcing work for it.

Wellcom chief financial officer Andrew Lumsden says the Malaysian operation is expanding “through organic growth within the region together with the ability to offer our Australian client base improved turnaround times where required due to the time difference”, rather than through shifting work offshore from Australia.

[Related: More financial reports coverage]

The company’s American business theLab made a $3.86m profit on $19.83m in sales for its first full year in the group – 26.9 per cent more than its turnover before Wellcom bought it for $7.1m in March 2014. Wellcom says its growth is ahead of expectations.

It is joined by American marketing firm Dippin’ Sauce, which Wellcom acquired on July 1. Its clients include Vogue, Harry Winston, and FCB Health.

Sidwell says global brands are looking for partners to adapt global content to local markets, as the fast moving retail world sees messages change with increasing frequency.

“The demand for high quality visual content continues to grow, with the speed at which brands can produce this content playing a significant role in their success,” he says.

Comment below to have your say on this story.

If you have a news story or tip-off, get in touch at editorial@sprinter.com.au.  

Sign up to the Sprinter newsletter

Leave a comment:

Your email address will not be published. All fields are required


Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates from our team.