PaperlinX announces 2012 full year results
In a statement to the ASX (Australian Securities Exchange) international merchant group PaperlinX has announced a statutory loss after tax of A$266.7 million for the year ended 30 June 2012.
This statutory loss reported is in line with the A$171 million forecast as announced on June 26. However the increase is largely due to the Board’s decision to write off all remaining goodwill on the Group’s European operations.
PaperlinX said that current operating results are being severely impacted by the continued European economic crisis in addition to the ongoing structural decline in paper in its key markets. Improving the performance of its traditional paper business is a business priority and whilst the UK remains profitable at the trading level, further restructuring is underway to enhance the result.
Generating growth through diversification is also a key objective of PaperlinX going forward and its focus is on continuing to grow its diversified business in Packaging and Sign & Display.
Dave Allen, Interim CEO said that cash generated from asset disposals and the close out of the currency option have provided much needed liquidity, reduced debt and funded crucial restructuring.
The sale of businesses in the US and Italy have now been closed. In addition, the sale of its operations in South Eastern Europe and South Africa are expected to complete in the first half of fiscal year 2013. Total net cash proceeds are expected to be approximately A$90 million.
“While we have made significant progress over the year to transform PaperlinX, there is still much work to be done to return the company to operating profitability,” said Mr Allen. “The internal restructuring programme, supported by the Board, has been expanded and accelerated and we expect that total costs of A$45 million will generate annualised benefits of A$73 million by fiscal year 2014.
“Our remaining businesses have significant positions in sizeable markets and with a lower cost base; we are now better positioned to become a successful broad based material supplier,” he says.
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