Salmat strong with catalogues and down in direct mail

Mixed bag for Salmat’s printed products as the customer communication company reports an increase in catalogue volumes, while mail and print management services decline.

At its annual general meeting this week, the company reported a strong financial performance, with sales revenue of $878.8 million, up by one per cent. Salmat also exceeded its earnings guidance of $85-90 million with a result of $91.2 million – up by 17.3 per cent on the prior year.

Salmat’s Targeted Media division, which includes letterbox distribution services and the Lasoo pre-shop website, had a strong year, delivering $230.6 million in revenue and earnings of $44.3 million.

CEO, Grant Harrod, (pictured) explained that this was largely the result of increased volumes across the division, including catalogues, which were up 11 per cent on the previous year to more than five billion.

“We’ve also seen an increasing trend in traditional letterbox clients moving towards a more integrated communication model, incorporating online and interactive channels,” he said.

Volumes did not remain high across all areas of Salmat, however. Its Business Process Outsourcing division, which incorporates essential and direct mail, print on demand and print management services, saw revenue down by 5.7 per cent to $343.4 million due to lower mail volumes in essential and direct mail, the closure of an “underperforming” creative marketing business and foreign exchange movements with Asian operations.

“While we expected print and mail volumes to remain flat, 2010 volumes ended up lower than the previous year, so this was one objective that wasn’t met,” Harrod said. “We do not expect the same rate of decrease in the current year and have a solid pipeline on new work.”

Next week, Salmat will launch a self-service web portal that enables SME clients to access design, print, letterbox and online marketing services to promote their business.