Financial Printing Outlook — Clawing Their Way Back

By Caroline Miller

It has been a tough year for the financial printing industry. The economy was already shaky when the September 11, 2001, terrorist attacks hit the World Trade Towers—America’s financial epicenter. Investment banking, securities law and financial services are in shambles. Even so, most hoped to see that much needed and much talked about recovery in 2002. But, instead, the year has been mired in corporate accounting scandals, a never-ending bear market, the threat of war and the virtual standstill for M&A deals and IPOs.

As a result, financial printers have had to reduce their work forces, streamline their operations and look outside for sources of revenue.

Top 10 — Financial Printers
  Company Segment
Sales
(millions)
Total
Sales
(millions)
1 Bowne & Co.
New York
$717 $1,055
2 R.R. Donnelley
Chicago
$476 $5,298
3 Merrill Corp.
Saint Paul, MN
$241 $602
4 Ennis Business Forms
DeSoto, TX
$49 $236
5 Burrups Packard
Philadelphia
$25 $50
6 Applied Printing Technologies
Moonachie, NJ
$22 $95
7 Henry Wurst Inc.
N. Kansas City, MO
$16 $109
7 Scott Printing
New Providence, NJ
$16 $32
9 MacNaughton Lithograph/ Command Web Offset
Secaucus, NJ
$14 $140
10 GlobalWare Solutions
Haverhill, MA
$10 $105
Sales figures are based on above printers’
self-reported total and market segment breakdowns.

“There’s no denying it—2002 has been a terrible year for the financial printing industry,” admits Paul Masterton, president of R.R. Donnelley Financial, the second largest financial printer in North America with segment sales of $476 million.

“While we’ve always been vulnerable to economic cycles, this is as severe as we’ve ever seen it. And it’s impacting more than the financial printing industry,” he adds. “It is seriously impacting the clients we serve with significant layoffs throughout the investment banking, securities law and financial services communities.”

In the capital markets, the industry’s market size reportedly fell from $1.6 billion in 1999 to $1.1 billion in 2001. In that same time frame, IPO demand fell from 544 to 132. In 2002, the capital markets business has seen an even greater decline, with a total market size of just $900 million. Overall, deal flow in the market has decreased, with SEC filings down 11 percent from the previous year, including a 16 percent drop in M&A business and a 13 percent decrease in secondary deals.

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