- London-based 4imprint Group sells items such as books, bags and lanyards
4imprint Group shares slumped on Wednesday after the promotional products firm warned that tariffs could hurt its sales this year.
The FTSE 250 company, which sells items such as books, bags and lanyards, saw its shares plunge by 19 per cent in early trading before somewhat rebounding to be 11.8 per cent lower at £42.25 by the late afternoon.
Its chairman, Paul Moody, blamed ‘continued uncertainty’ for its order intake volumes being ‘slightly down’ in the first two months of 2025 compared to the equivalent time last year.
President Donald Trump’s imposition of taxes on imported goods entering the United States has led to widespread political and economic uncertainty as many countries have retaliated with their own tariffs.
Following a 25 per cent levy on steel and aluminium imports, Canada has responded with more than $20billion of taxes on US goods, while the European Union declared €26billion of ‘countermeasures.’
Moody said tariffs may ‘continue to influence demand’ this year, although he added that sales of promotional goods tend to improve as business confidence recovers.
Concerns: 4imprint Group shares slumped on Wednesday after the promotional products maker warned that tariffs could hurt its sales this year
4imprint’s turnover increased by 3 per cent to $1.37billion in 2024 thanks to higher average order values compensating for a decline in new client orders against a more challenging economic backdrop.
The company’s pre-tax profits jumped by 10 per cent to £154.4million, supported by gross margins benefiting from targeted price hikes and minimal supplier cost rises.
While headquartered in London, the firm earns the overwhelming majority of sales in North America, where it recently completed a $20million expansion of its Wisconsin distribution centre.
Even so, it ended the year in a much healthier financial position, with cash and bank deposits 41 per cent higher at $147.6million.
As a result, 4imprint is proposing a special dividend of 250 cents per share, taking its total investor payouts for 2024 to $4.90 per share.
Moody said: ‘Despite a challenging near-term environment, our view of the prospects of the business remains unchanged. The board is confident in the group’s strategy, competitive position and growth opportunity.’
However, Russ Mould, investment director of AJ Bell, warned that current concerns of an economic downturn in the US were not helping the company.
He said: ‘Sentiment towards 4imprint and its performance have always been closely tied to US GDP, so speculation about a recession in the world’s largest economy is unhelpful.
‘This has been reflected in recent share price weakness and today’s results put the stock under further pressure as the outlook statement confirmed the market’s fears.’
Mould added: ‘4imprint might hope that should tariffs work as intended and domestic US businesses prosper, it will do so too, but for now, uncertainty reigns.’
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