Lack of customer trust hits PMP catalogue distribution business

Catalogue scandal continues to haunt print and distribution giant, PMP.

Following ongoing suspicion, in 2008 PMP admitted to distribution errors for some of its catalogues, which former CEO, Brian Evans, claimed affected only “a small number of customers.”

The repercussions can be seen years later in the company’s 2010 half-year results, released today, where earnings dropped 65.7 per cent to $1.5 million in the half, compared to the same period last year. A statement from PMP said that these results were proof of “losing touch with its customers, forfeiting their trust and consequently losing market share.”

Since taking over as CEO, former PMP CFO, Richard Allely, (pictured) has worked hard to overcome the damage, namely through a string of new appointments to handle its distribution.

“With a new and very experiences leadership team in place, our distribution division is focussed on developing strong customer relationships and building an efficient and market competitive distribution network that, over time, will restore profitability to the business,” he said.

In September last year, PMP picked up a $25 million printing and distribution contract for Franklins, but later lost its catalogue contract with Coles. PMP reported EBIT of $29.1 million for the half-year ending 31 December 2009.
 
Its print division also suffered, with revenues declining by 13.2 per cent to $269.5 million, following a drop in print volumes by 14.7 per cent in the six months to December 2009.