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Photo-Me’s struggling Japanese business to return to growth next year

Photo-Me bosses have reshuffled the Japanese management team, while low revenue machines have been relocated and unprofitable ones removed altogether

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The Japanese photo ID market is “more challenging” and “highly competitive”

Photo-Me International plc (LON:PHTM) expects its struggling Japanese business to return to growth in 2019.

Given the “challenging” market conditions over there, Photo-Me bosses have reshuffled the Japanese management team, while low revenue machines have been relocated and unprofitable ones removed altogether.

New units which promise a 35% faster return on investment have also been deployed.

READ: Photo-Me reports rise in full-year profits

“Whilst the photo-identification market in Japan remains highly competitive, the benefits of Photo-Me's initiatives are becoming evident earlier than initially expected,” read today’s AGM update.

“The board is confident that its Japanese subsidiary will return to growth in FY 2019.”

Closer to home, Photo-Me said it is in “advanced discussions” with French and Dutch authorities to roll out its encrypted passport photo upload technology in the two countries.

In France, Photo-Me’s tech is currently only approved to be used in driving licence renewals, but the company wants to extend this to include encrypted upload for new passports and identification cards.

Guidance reiterated

It is also trying to get the Dutch government to approve its technology for driving licence applications.

At today’s shareholder meeting, the £375mln company will reiterate its full-year guidance. First-half results will be in line last year’s, excluding an exchange gain and a favourable commercial litigation outcome this time around.

Shares flashed 10.2% higher to 109.8p in early deals on Wednesday.

Quick facts: Photo-Me International PLC

Price: 47.55 GBX

AIM:PHTM
Market: AIM
Market Cap: £179.74 m
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