Paper merchant and wide format solutions supplier Spicers doubled its first half earnings compared to last, as its print and packaging division grew, while sign and display dipped.
Its EBIT rose to $7m, up from $3.4m, on net sales revenue that rose by 4.9 per cent to $158.6m from last year's corresponding period.
Profit after tax from continuing operations performed even better, it trebled from $1.9m to $5.9m. However the company reported a statutory loss for the half year of $6.7m thanks to a $15.2m loss on the sale of its Asian operations, to Ball & Doggett owner Japan Pulp & Paper.
Spicers underlying EBIT in Australian of $5.1m was up by two thirds, $2.1m, on last year's figure, with print and packaging the star performer.
Print and packaging revenue grew by 8.5 per cent, while sign and display revenue was 5.3 per cent lower, in what Spicers says were 'challenging' market conditions.
New Zealand’s underlying EBIT of $3.9m was 0.5 per cent higher than pcp in local currency terms, with what Spicers says were solid results delivered across all product categories.
As first reported in Print21, Spicers is due to become part of the giant Kokusai Pulp & Paper business by July, the Japanese trading company launching a $146.7m bid for the business on 18 January.
Commenting on the result, Spicers chief executive officer David Martin said:“We continue to meet our promises. These results are the outcome of strong business strategy and execution by the talented people in our business. With ongoing growth in our revenue, along with our continuing focus on efficiencies, we have met our promise to improve shareholder returns consistently, period-on-period, over the past two and a half years. Initiatives to further improve our growth potential, and seasonal working capital trends, have led to a cash outflow in the first-half, which will essentially reverse in the second-half.
"We are pleased with the continued progress in our operating businesses and, working in concert with the board, our Corporate cost reduction initiatives, all delivering improved shareholder value. This has all now culminated in an offer from Kokusai Pulp & Paper to acquire the whole of Spicers via a scheme of arrangement, a proposed transaction that we believe is attractive to shareholders. We look forward to updating shareholders and seeking their support on this proposed transaction in the coming months.”