Thursday, 28 February 2008

Garden starts to bloom for Steve Vaughan at Communisis

I share a passion for gardening with Steve Vaughan. Indeed we have both opened our Surrey gardens for the National Gardens Scheme. But my friendship with Steve started when he took on Synstar (the old Granada Computer Services). He turned a “bit of a basket case” into a highly valued IT services company and tripled the share price in the process when it was bought by HP in early 2005. Continuing the ‘basket case’ theme, in Mar 06, Vaughan was headhunted by Kevin Lomax to head up Misys’ Banking operations. It all went spectacularly wrong with Vaughan leaving after just three weeks quoting “material differences”. Not that difficult with Lomax, I have found! It was Vaughan, not Lomax, who came out of this episode with his credibility intact.

Vaughan then, in late 2006, joined print/direct mail company Communisis – which if not another ‘basket case’ had “overpromised and underdelivered” for many years. Being the good gardener that Vaughan is, he didn’t promise an instant makeover. Instead he pruned and replanted – I’m sure he spread some manure at various points too!

The first shoots of the turnaround came yesterday when PBT of £7.9m for the 12 months ended 31 December 2007 compared with a loss of £19.4m in 2006. Revenue rose to £290.6m from £260.6m whilst net debt has fallen from £44.9m to £26.3m.

There have been many eager to write off print services in today’s internet age. Just because the market contracts does not mean that individual companies cannot prosper. Indeed, as suppliers disappear those that are left can pick up extra workloads the revenues from which often go straight to the bottom line. Much of the hardware used has been written off long ago.

But, at the end of the day, companies, just like gardens, bloom not because of soil conditions or the weather but because of the experience and dedication of those that tend them.

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