Havelock to cut debt after £15.3m sale of Showcard

A PRINTING company that has carried out work for the likes of Caffè Nero, Estée Lauder and Reebok was yesterday sold for £15.3 million by its Dalgety Bay-based parent group.

Shopfitting firm Havelock Europa decided to sell the Hertfordshire-based Showcard Print so it can pay down its debt and concentrate on its core businesses.

Showcard – which has also printed advertising material for clients including Dyson vacuum cleaners, Foster’s lager and KP nuts – has been the most-profitable part of Havelock in recent years, producing a pre-tax profit of £2.9m in 2010 after turning over £21m.

But Havelock chief executive Eric Prescott, who was brought in during 2010 following the departure of long-serving boss Hew Balfour, told The Scotsman that now was the right time to sell the printing operations.

“I’ve been carrying out a strategic review since I joined and Showcard is not part of our core business,” he said.

“It prints advertising material for points of sale, whereas we are a shopfitter. It is a leader in its field, so I wouldn’t hesitate to use the company in the future for work, but there is very little crossover between us.”

Prescott said it would be wrong for Havelock to invest money to expand Showcard when it is not part of his core strategy and so he approached the firm’s management team to see if they wanted to buy the business. They competed against other trade buyers but ultimately won the battle to buy the company, with backing from Lloyds Banking Group.

Havelock will retain ownership of Fontana House, Showcard’s base in Letchworth, and will rent the building to the new company for £150,000 a year after signing a ten-year lease. Showcard also claims to own “the world’s largest litho press”.

The Fife company, which traces its roots to the 1970s, bought Showcard in 1996 and combined it with Bristol-based printer Hartcliffe the following year.

Grant Findlay, finance director at Havelock, added that the cash from the sale will be used to pay down Havelock’s debts, which stood at £17.2m on 30 June.

In terms of its own trading, Aim-quoted Havelock said its results for last year would be in line with City expectations, with house broker Investec expecting the company to break even or turn a profit of up to £500,000 before exceptional items, compared with 2010’s losses of £600,000.

Havelock has announced a string of contract wins in recent months, including a £20m deal with Lloyds Banking Group – its biggest client – a £5m contract with high street retailer Boots and a classroom furniture deal with construction and infrastructure firm Balfour Beatty for school work.