Print management play TripleArc, a Company Watch recommendation at 15.5p, has warned results for 2004 will be 'slightly' below expectations.

Jason Cromack, chief executive, says implementing innovations diverted the technology division from boosting turnover, while 'full scale revenues' from certain print management deals took longer than expected to materialise. TripleArc has racked up deals with the likes of BAA and BMI Healthcare – in November announcing a print management deal with Virgin Mobile, following hard on the heels of a multi-million pound contract with Virgin Retail. Before the update, house broker Altium Securities suggested adjusted profits of £3.8m on a turnover of £58m for the year. Analyst Andrew Nussey has now downgraded his current earnings estimate by 7%. In more upbeat news, TripleArc has announced the acquisition of direct mail fulfilment venture HFS, which should help the group win large 'data-centric' print fulfilment contracts and brings cross-selling potential. TripleArc has shelled out £640,000 in new shares valued at 19.675p, with an additional consideration of up to another £8m tied to HFS's performance in the two years to December 2006. We feel there is nothing fundamentally wrong with TripleArc, which continues to gain kudos in the growing print management outsourcing market and offers investors good visibility for 2005. Well worth holding.

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