Cost of turnaround hits Photo-Me revenue and earnings

10th Dec 2018 11:22

(Sharecast News) - Instant-service equipment group Photo-Me International announced its results for the six months ended 31 October on Monday, reporting a 2.5% improvement in underlying revenue to £119.8m, excluding the impact of restructuring Photo-Me Retail in the comparative period.Total revenue was down 2%.The London-listed firm's adjusted profit before tax fell 7.9% to £26.7m, when adjusted for one-off items in the first half of 2018 and the first half of 2019, while profit before tax slid 21% to £26m.Its board said the company remained "highly" cash generative, with £36.1m of cash generated from operations in the period, down from £39.9m.Photo-Me said its net cash position stood at £32.4m, down from £47.1m year-on-year, following a distribution of £28.8m to shareholders in dividend payments and £33.4m of investments made in the last 12 months.The interim dividend was maintained at 3.71p per ordinary share, which was in line with the board's stated dividend policy for 2019.On the operational front, Photo-Me said its operations in Japan had recovered faster than expected, with underlying Asia operating profit up 15%, excluding the cost of restructuring operations in Japan.It undertook a continued expansion of its laundry operations, with over 30% more 'Revolution' units up and running at period end, and total revenue from Revolution improving 28.5%.Identification revenue growth increased 2%, reflecting further diversification of that division's services and the successful deployment of secure photo ID upload technology.Innovation was also a focus for Photo-Me, reporting that after period end in November, the first banking booths which provided front-end retail banking services to customers were launched in Paris.Looking ahead, the group maintained its guidance for the 2019 financial year, and expected to report profit before tax of £44m, net of restructuring costs in Japan and excluding any movement in the value of Max Sight Holdings.Photo-Me said its ability to meet guidance would be reliant on normalised trading conditions in its key markets."In the last six months, the expansion of laundry operations and deployment of photobooth identification solutions continued in line with our plan," said chief executive officer Serge Crasnianski."Revolution Laundry units in operation and revenue from these machines were up 30.4% and 28.5% respectively in the first half of 2019."In additional we continue to diversify our identification business offering."