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PMP doubles profit despite revenue slump

Tuesday, 25 August 2015
By Print21

Australasia’s leading printer PMP says its resurgent catalogue business has driven ‘a major uplift in profit after several years of unsatisfactory performance.’

The region’s biggest print company announced a 134% increase in profit to $8 million for financial year 2015 – compared to $3.4 million in the prior corresponding period – and has declared a dividend to shareholders.

However, revenue was down 9.7% – or $87.5 million – to $811.7 million, with $38 million of the loss attributed to lower volumes at distribution unit Gordon and Gotch. A statement to the ASX said sales in the core Australian business were down $49 million or 8.7%, with $30 million due to a print customer buying their own paper, the exit from the Directories business and the company not pursuing low margin print contracts. Underlying sales were down $19 million or 3.4% partly due to lower customer frequency and an insolvent distribution customer.

'Another solid result': Peter George, CEO, PMP

“The company has delivered another solid result, ahead of guidance,” said PMP CEO Peter George. “It was pleasing to see the company more than doubled net profit compared to last year, albeit off a low base. Net debt has been reduced by 68% over the last 12 months and is at a new all-time low, a clear indication of our cash generating capability.

“The printing and distribution of catalogues in both Australia and New Zealand accounts for the majority of PMP’s earnings. Catalogues continue to be a key marketing channel and effective media for driving sales for retailers and remains the company’s core activity.

“We are continuing to focus on building a more profitable and sustainable PMP by focusing on the company’s core expertise in print and distribution. We offer a compelling competitive advantage to our customers through our unique nationwide bundled printing and distribution solution. An increasing number of our large customers are taking up this offering as it provides increased speed to market and lower overall costs.”

George said the company had now largely completed the major transformation programme that started in 2012. “The first two of our three strategic priorities – cost base reduction and financial risk minimisation – have been delivered, and the third is ongoing. Our balance sheet has been substantially improved with net debt at June 2015 reduced to $16.3 million. PMP is on track to be net debt free in fiscal 2016, in accordance with our three year goal.”

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