Marketing services group IVE says its new twin-site folding carton operation is progressing, and will reach $90m in annual revenue once its Sydney facility is up and running.
IVE will then progress with further investment in its folding carton business, which will take it to $150m in annual sales within five years.
In the 2023/24 financial year, the company invested some $2.8m in deposits on equipment for its new Sydney folding carton facility, which is being built in its commercial print centre.
Releasing its annual results, IVE saw all its key profit metrics rise in the last financial year. Its EBITDA rose to $127.8m, up by 7.5 per cent from the previous year, while its net profit after tax was up by 8.4 per cent, to $43m.
Revenue was virtually unchanged, up by just 0.3 per cent, or $2.5m, to $969.9m, which the company’s CEO Matt Aitken attributed to “an increasingly difficult economic landscape”.
IVE’s base revenue was down by about four per cent, relative to what it says was a strong prior corresponding year, the drop IVE says largely due to economic conditions in the second half from January to June. Its commercial printing business in particular was hit, along with its CX and Data business.
IVE’s net debt rose by $6.8m to $131m, reflecting the $28m acquisition cost of JacPak, which was largely offset by a strong increase in operating cash flow.
IVE forecasts its net profit after tax to increase slightly in the current financial year, it says it will be around $45-$50m.
The company says that while diversification through acquisition remains a core strategy it does not currently have anything in its sights.
Aitken said, “The FY24 result was consistent with the targets we set at the beginning the year.
“In addition to completing the Ovato acquisition ahead of schedule and reaffirming the integration synergies, we completed the acquisition of JacPak, which is performing in accordance with expectations.”
Organic revenue growth came in brand activations (display print), third party logistics, and fulfilment. It says magazines and catalogues were in line with expectations.
Retailers make up half of IVE’s customer base at 51.4 per cent, with financial services the next largest sector at 8.7 per cent.
The $2.8m placed as deposits on new packaging equipment includes new die-cutting and folder gluing systems to go into its commercial printing facility at Sydney, which is being expanded to accommodate a packaging operation mirrored on JacPak in Melbourne.
IVE says the value of folding carton packaging in Australia is around $800m, and growing each year.
JacPak, which was acquired in October last year, contributed $28.3m in revenue, which IVE said was broadly in line with its anticipated $45m a year sales.
