Evans said the changes were extreme but necessary if the Group was to deliver on its commitment to shareholders.
“When I joined PMP in November I found a company that, although trying to reform,
couldn’t keep up with the rate of change in its markets. The Group’s management structure was top-heavy and the core print business was struggling with its historical
culture and cost base and was losing market share,” he said.
“On the up side, I could see that, with the right cost base, there was a great opportunity to leverage the $124 million investment in new presses. In addition, the Group had made some good strategic acquisitions in New Zealand that are already delivering improved earnings in that business.”
Evan’s initial reforms have significantly reduced PMP’s senior corporate ranks. He has also decentralised Print’s management to give the business more autonomy and introduced an uncompromising cost savings program.
“This cost saving and efficiency drive will be relentless and ongoing,” said Mr Evans. “In addition to all of these changes and savings, there are significant opportunities to grow the top line and recover some of the market share lost in recent years. We now have all the new presses on line in Sydney and Brisbane. Adelaide is on schedule to be commissioned in the last quarter. This provides significant additional capacity to that which was available to the business and our customers last year. We are currently selling into that capacity and the early indicators are promising. Some of our customers are looking to bring back work we lost due to capacity constraints and service and delivery issues,” he said.
PMP reported a half-year EBIT (earnings before interest and tax excluding significant
items) result of $40.1 million, matching previous company guidance. Mr Evans said
the results were in line with expectations and would continue to improve.
PMP’s net profit after tax and significant items reduced by 43.8 per cent to $18.4 million,
while operating sales revenue was $655.7 million, down 9.3 per cent on the pcp.
