The chill of losing a major client to heatset last year, with another about to make the move in the near future, has cut the ground from under Sydney-based cold-set MPD Printing as tumbling print prices take their toll.
The long-established newspaper printer has gone into voluntary administration the better to sell the vibrant business as a going concern. Long-term managing director, Linda Tenenbaum, who has worked in the business since its inception 33 years ago, said she was overwhelmed by the support from her employees, clients and suppliers. “Not a single client has left since we made the announcement. Not a single supplier has refused to work with us,” she said. “Our staff have been very supportive. We wouldn’t have done this if there was any other way; we’ve really fought to keep it open. But we can’t just trust to luck.”
In a text-book performance as to how a printing business can be wound down with the minimum of collateral damage, Tenenbaum, along with Cheryl Dove, director and business manager MPD, made sure all employees entitlements are up to date and there will be no huge losses to creditors. Accounts were maintained at terms before the voluntary administration and suppliers such as Norske Skog, Agfa and DIC have all pledged their support to keep the business operating while a buyer is sought.
“We lost a major client last year to heatset, but we clawed back to operate at break-even. Now we’re about to lose another. We’ve invested everything in the business and we just don’t have the kind of capital required to turn it around. There are deflationary pressures on pricing and because of our location [in Alexandria, halfway between the CBD and the Airport] our infrastructure costs are much higher,” she said. “There is no alternative.”
Changes to the structure of the newspaper industry have taken their toll. One of MPD’s high profile titles, Financial Times, was the first to change from daily to weekly, the same frequency as other international titles, such as the China Daily and the Daily Express.
Circulation and pagination of local mainstream ethnic newspapers have fallen. The company prints newspapers in 35 languages and its client list provides a demographic window in the changing makeup of Australia. As former major ethnic groups such as Italians and Greeks lose numbers, Samoan and Pacific island communities replace them. Time sensitive, fast turnaround, small print runs are a feature of the sector with few printers able to offer the MPD service.
In a statement released by the administrators today Tenenbaum said, the pressures on pricing in the core ethnic and expat newspaper markets, along with increases in key costs, have continued unabated.
The printing industry as a whole is experiencing a difficult and increasingly volatile economic environment. Both frequency and page counts of press runs have been adversely impacted by cost cutting efforts in consumer industries and imports.
MPD Printing currently turns over $9 million per year and operates two eight-unit web press lines, with a total of six USA-made Tensor 4-high towers.
In the past year in an attempt to broaden its market from traditional newspapers MPD sought to engage with designers, colleges, theatre groups, writers, poets and other creatives seeking to use the edgy, tactile qualities of newsprint in new and interesting ways. It may be the only newspaper printer that allows artists to press check their work.
The administrator, Jamieson Louttit of insolvency and advisory firm, Jamieson Louttit & Associates, is seeking expressions of interest. In a statement he said, the printing industry has been impacted by the new alternative printing techniques but there are many instances where cold-set printing can achieve better results than the new technologies.
“We went to Jamieson Louttit because of their reputation as selling going concerns. They’ve been wonderful so far. But if we don’t find a buyer our options will be very limited,” said Tenenbaum.
MPD Printing started as Marrickville Newspapers, an independent cold-set web printer, in October 1982, with a 4-unit Goss web press and basic typesetting, photographic and plate processing. In the intervening years it shifted premises twice. The company has a reputation for ethical behaviour, especially towards its staff.
“We’ve done very well over the years. We've employed many, many wonderful people who have contributed to the business just as we've contributed to the quality of their lives. All our employees can feel proud of what we’ve achieved,” said Tenenbaum.
Expressions of interest in purchasing the business should be directed to Jamieson Louttit & Associates.