March 26, 2018 / 5:00 PM / a year ago

UPDATE 1-Neopost sees revenue, margin decline in 2018

(Adds CFO comment)

March 26 (Reuters) - Neopost expects its revenue and current operating margin to decline in 2018 after a fourth quarter weighed down by its customer communications business, the company said on Monday.

The French company, which is counting on customer communications management and logistics to compensate for a decline in its mail processing business, said its Enterprise Digital Solutions business had failed to seal a number of contracts in client communication, impacting fourth quarter sales.

“At the end of the third quarter we had a big pipeline of prospects for the sale of large software licensing contracts for managing client communications,” Chief Financial Officer Jean-Francois Labadie told journalists during a call

“Not only did these prospects fail to materialise but we had tough comparables from the fourth quarter of 2016.”

Neopost said it expected 2018 revenue to decline “organically”, while its current operating margin would be around 18.0 percent.

For 2017, the company reported revenue of 1.11 billion euros($1.38 billion), down 4.1 pct. The current operating margin was 18.2 percent, down from 18.6 percent in 2016.

The company proposed an unchanged dividend of 1.70 euro per share for 2017. ($1 = 0.8039 euros) (Reporting by Alan Charlish and Cyril Altmeyer. Editing by Jane Merriman)

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