Caxton & CTP Publishers and Printers is exploring new markets and acquisitions as its primary business faces slowing demand and weaker consumer confidence amid rising operating costs.
This comes as Caxton reported a slowdown in performance for the year ended June 2026, and group revenue dropping by 1.8% to R6.58 billion, compared to the R6.7 billion in the previous year.
“This decline was felt mainly in our local newspaper publishing and printing operations and partly offset by some growth in the packaging and stationery segments,” Caxton said.
READ: Revenue, profit down for Caxton & CTP
Acquisitions on the radar
Caxton said the revenue pressure was compounded by new inflationary cost pressures and a R22.7 million reduction in the dividend received from its investment in Mpact, paper and plastics packaging and recycling business, which declared interim dividends of 15 cents per share for the half year ended June 30 compared to 30 cents per share for the comparable period.
Profit after depreciation and amortisation declined 7.4%, while headline earnings per share (HEPS) declined 5.7% to 168.6 cents from R178 cents from the previous year.
Middle East conflict a contributor to the slowdown
According to the group, the economic downturn has been intensified by the Middle East conflict that has eroded consumer confidence and spending across its diverse businesses.
The group had been optimistic that lower inflation and interest rates, together with a stronger rand, would support improved economic growth, but this was reversed by the conflict, which contributed to higher fuel prices, rising inflation and rand volatility.
The conflict, involving US and Iran, has led to the effective closure and disruptions of the Strait of Hormuz, which has forced up Brent crude oil, to over $100 a barrel.
The increase in diesel prices resulted in distribution surcharges that the group said were difficult to recover from customers. Higher utility costs, including water and electricity, as well as increased diesel expenditure for generators, have further placed pressure on the group’s ability to contain costs.
Raw material prices remained relatively stable during the year, although Caxton said prices had recently started to rise because of higher logistics and energy costs.
Despite these pressures, the group has kept staff and other operating costs under tight control. Staff costs increased by only 0.8%, while other operating costs rose by 0.1%.
The group also recorded plant impairment costs of R38.3 million, mainly relating to a further impairment of its Durban commercial printing plant following reduced tonnages and lower cash-generating ability, as well as its inoperative battery storage system at its original pilot site.
Caxton said its packaging and stationery businesses provided some offset to the weakness in local newspaper publishing and printing, with the segment recording growth during the period.
Ordinary dividends increase despite challenges
Despite the weaker earnings performance, Caxton ended the year with cash and cash equivalents of R3.07 billion, an increase of R47.9 million from the previous year.
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The group’s strong cash position gives it room to pursue expansion opportunities while continuing to return capital to shareholders.
The board declared an ordinary dividend of 80 cents a share, up from 70 cents previously, while the preference dividend increased to 650 cents from 570 cents.
Looking ahead, Caxton expects economic conditions to remain muted and broadly flat, unless there is relief from a resolution to the Middle East conflict.
- Caxton & CTP Publishers and Printers reported a 1.8% decline in group revenue to R6.58 billion for the year ended June 2026, mainly due to reduced local newspaper publishing and printing operations.
- Profit after depreciation and amortisation fell 7.4%, and headline earnings per share dropped 5.7% to 168.6 cents.
- The Middle East conflict worsened the economic downturn by increasing fuel prices, inflation, and rand volatility, impacting consumer confidence and Caxton's costs.
- Despite challenges, Caxton increased ordinary dividends to 80 cents per share and preference dividends to 650 cents, supported by a cash balance of R3.07 billion.
- The company is exploring new markets and acquisitions while maintaining tight control over staff and operating costs, with packaging and stationery segments showing growth.
Caxton & CTP
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READ: Revenue, profit down for Caxton & CTP
Caxton said the revenue pressure was compounded by new inflationary cost pressures and a R22.7 million reduction in the dividend received from its investment in Mpact, paper and plastics packaging and recycling business, which declared interim dividends of 15 cents per share for the half year ended June 30 compared to 30 cents per share for the comparable period.
Profit after depreciation and amortisation declined 7.4%, while headline earnings per share (HEPS) declined 5.7% to 168.6 cents from R178 cents from the previous year.
Raw material prices remained relatively stable during the year, although Caxton said prices had recently started to rise because of higher logistics and energy costs.
Despite these pressures, the group has kept staff and other operating costs under tight control. Staff costs increased by only 0.8%, while other operating costs rose by 0.1%.
Caxton said its packaging and stationery businesses provided some offset to the weakness in local newspaper publishing and printing, with the segment recording growth during the period.
Despite the weaker earnings performance, Caxton ended the year with cash and cash equivalents of R3.07 billion, an increase of R47.9 million from the previous year.
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