PMP shrugs off ACP print threat
Print and distribution giant, PMP, not scared of losing ACP magazine contracts as PBL Media presses ahead with opening its print centre.
At the company’s annual general meeting this week, CEO, Richard Allely, put on a brave face, telling members that: “My optimism for the print division holds true even if ACP goes ahead with its plans to establish its own printing facility. PMP currently enjoys modest revenue and earnings out of ACP, but we remain confident of being able to replace this with alternative business.”
Last year, PBL Media, which publishes ACP magazines, ended months of speculation when its CEO, Ian Law, issued a statement that the company would print its fleet of magazines itself by 2011 and reduce costs in doing so.
PMP managed to cover itself for the next few years by signing a three-year extension to its printing contract with ACP magazines on more favourable pricing terms and guaranteed volumes. The contract will revert to a five-year print agreement if ACP does not proceed to a greenfield site within the specified timeframe.
"We have undertaken an exhaustive analysis of the printing options available to us and it became clear during the process there were compelling reasons to take control of the production of our publications," Law said.
The decision drew criticism from PMP’s former CEO, Brian Evans, who claimed that: “These guys aren’t printers … this is a tall order for them.” In a report in the Australian Financial Review last month, some printing executives doubted that the print centre would be complete by 2011.
But in an interview with Print21, John Rowsthorne, (pictured) general manager operations at PBL Media, hit back at these allegations, confirming that the printing centre was on track, though he declined to offer a date. "We are still proceeding," he said. "We have a time frame in place and are proceeding as planned."
PMP’s print division had a “disappointing year” according to Allely, who reported that revenues had fallen 3.9 per cent to $696.4 million after volumes declined significantly in the fourth quarter. This, combined with price pressure, lead to earnings dropping 36.5 per cent to $41.6 million. In addition, PMP’s earnings for the year overall plummeted from $85.1 million to $54.2 million.