However statutory pre-tax losses increased five-fold from £3.1m in the like period last year to £15m this year, after accounting for numerous ‘adjusting items’ totalling £27.7m. These included acquisition costs of £23.4m, impairment charges of £2.2m, £0.9m in pension scheme costs and £1.2m of restructuring costs.

Net debt, on a more positive note, was reduced from £54.6m in July 2017 to £42.2m and the pension scheme deficit was marginally reduced from £16m in July 2017 to £15.8m, mainly due to a decrease in the discount rate used.

Interim share dividend was held at 65p per share (H1 2017: 65p per share).

The results were published two days after the group announced the sell-off of its £106.3m-turnover wide-format operations for a cash sum of £6m, which the company says will be used to reduce group debt.

The loss-making businesses, which formed the majority of St Ives’ Marketing Activation division and included Redditch-based SP Group, Service Graphics in Chessington and marketing firms Tactical Solutions and Flare, were bought by SelmerBridge. The combined businesses have been labelled as ‘discontinued operations’ in the latest set of results.

Managing director of the Marketing Activation division, Nick Cole, has remained with that part of the business to continue to head up its St Ives Management Services, which provides outsourcing and supply chain management services to clients including Royal Mail, The Co-operative Group, Conservative Party, Akzo Nobel and Informa.

In the book division, Clays in Bungay, profits continue to slide with £0.8m adjusted operating profit at the half year (2017: £2.7m) on revenues of £37.4m, down £4m from H1 2017. The group cited the loss in February last year of its multi-million pound HarperCollins contract for the disappointing results, although it said that trading in the first half had been generally positive. No detail was given on Clay’s lucrative contract for book publisher Hachette, which expires this year and will be facing a review.

No update was given in the report on the future of Clays, although rumours are rife in the industry that the sale of the business could be imminent.

In its Strategic Marketing division, which makes up 63% of H1 group sales, revenues increased from £75.8m in the same period last year to £91.7m in the six months to 2 Feb 2018. Meanwhile adjusted operating profit in the segment doubled from £5.9m to £12m.

Strategic Marketing, which comprises Digital, Data and Insight, is now the core focus of the group’s activities and key to its long-term growth strategy with major clients including Tesco, Kraft Heinz, Jaguar Land Rover, Electrolux NFU Mutual and Sun Life. Priorities for the division include "collaboration, internationalisation and acquisitions", the group stated. According to the report St Ives is currently focussing on organic growth, but in the long-term a key element of the division’s growth strategy will be the acquisition of “further complementary marketing services businesses which add value to our existing portfolio and operate in our chosen growth areas of digital, data and insight services”.

An industry source called the results: “The usual thumping loss from St Ives [despite the wide-format division sale] “which is conveniently badged as discontinued”.

“The £27m of write downs in continuing operations include a combination of restructuring costs and write-downs of goodwill, which is another way of saying they paid too much for acquisitions in Strategic Marketing. Adjusted profits hide a multitude of sins but for the time being the wool has been well and truly pulled over the City’s eyes.

“If someone wants the books or print management businesses for very little, I’m guessing they can have it. The poison pill is the pension fund deficit.”

No-one at St Ives was available for comment following the publication of this morning’s result but in a statement chief executive, Matt Armitage, called the first half result “encouraging” and that the group remained confident in its long-term growth strategy.

"Strategic Marketing continues to go from strength to strength, and making a significant 85% contribution to adjusted operating profit during the period. Trading continues to be strong in this segment. We are encouraged by new projects won from both existing and new clients, and excited by the opportunities generated from increased collaboration between our businesses. 

"Having indicated our intention to remain focused on diversifying into other sectors, we are pleased to have recently announced the disposal of a significant element of our Marketing Activation segment. This significantly reduces the group's exposure to the structurally challenged, commoditised print markets and the risk of further, potentially significant re-structuring costs.

St Ives shares rose by 10.4p or 14.02% to 84.6p on the news (52-week high: 84.6p, low: 37.5p).