PMP faces two years of restructuring costs
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SYDNEY, Nov 22 AAP
November 22 2012, 3:36PM
PMP shareholders are unlikely to receive a dividend in the period ahead, as the troubled printing and publishing business adapts to upheavals in the media.
The shift of readers online has forced companies such as PMP, with their large printing presses, to transform their business and find a way to thrive amid falling demand for printed newspapers, telephone directories and books.
Also, a weak retail environment has led to less demand for shopping catalogues.
PMP chairman Ian Fraser says the company has been hurt by the changes taking place in the media and has responded by implementing a transformational plan.
This major structural change would continue to incur large significant costs for the next two financial years, Mr Fraser told shareholders at PMP's annual general meeting in Sydney on Thursday.
Mr Fraser said the reduction of debt was the prime objective of the board, in addition to lowering costs at PMP's print business.
"Consequently, in the short term, it unlikely that dividends will be considered as all available cash is used to reduce debt and fund transformation," Mr Fraser said.
"I would like to emphasise that the transformation is not just about costs, it is also about strengthening our sales force, client engagement and growing our share of (the) market."
PMP declared a one cent per share fully franked dividend at its full-year results.
Guidance for 2012/13 was unchanged from what the company said earlier in November.
Earnings before interest, tax, depreciation and amortisation (EBITDA) and before significant items for 2012/13 was forecast at between $69 million and $72 million.
This compared with EBITDA before significant items of $76.5 million the prior year.
The company announced on Wednesday that it would close its Chullora printing plant in Sydney in June 2013, with the majority of the plant's 130 employees likely to be made redundant.
At 1533 AEDT, PMP was up one cent at 19 cents.
By Jordan Chong