Catalogues are the sole remaining mass media – Richard Allely

With the ability to blanket every household in Australia, the $7 billion letterbox channel provides retailers with the only true mass medium. According to Richard Allely, managing director, PMP currently holds 30% of the $7 billion market to Salmat’s 70%, but in the hugely competitive market it still cannot make a quid.

The distribution division was one of a number that failed to turn a profit in an overall upbeat end of year statement from the printing giant. However, thanks to internal efficiencies the company is able to turn in a profit of $20.6 million.

Despite the GFC, catalogue volumes proved resilient, growing by 3% even as the overall printing volumes fell by 13.7%. The medium retains its appeal as a pragmatic marketing channel, especially for food retailers.

The revenues of the company’s core printing division fell by 13.4% to $492.1 million. Allely (pictured) attributed much of the loss to PMP losing the Coles printing work following the withdrawal of the retailer’s catalogue distribution in favour of Salmat as a result of bad work practices. On a brighter note he pointed out PMP had picked up the Target production work, which is again a “foot in the door” of the West Farmers Group, owners of Coles.

For PMP’s Digital Premedia division, which in includes Pacific Micromarketing, earnings declined to $3.5 million, in line with reduced corporate marketing and advertising spend. Allely said the recent acquisition of Adcast, now re-launched as dMarketer, has already attracted some large corporate clients. He pledged the company would continue to develop the marketing technology.

The book distribution business of Gordon and Gotch suffered as result of having no hit titles during the year. Lower book publishing volumes were only partially offset by a new distribution contract with News Magazines. Gordon and Gotch is now the number one magazine distributor in the country, supported by the re-signing of a long-term contract with Pacific Magazines for a further 10 years. In addition, following the closure of NDD, it has 100% of imported magazine distribution.

“Notwithstanding the early indications that advertising markets are improving, PMP’s real strengths in the next financial year will come from within the company. The Group is now far more efficient, customer-focused and properly structured to deliver improved returns to our owners,” said Allely.