No pick up for paper, CPI predicts

Fine paper merchant, CPI, struggles in the face of a contracting industry.

After a difficult year, the company reported its half-yearly figures for the six months ended 31 December 2009 where $3,919 million, down from $5,254 for December 2008.

CPI’s managing director, Bernard Cassell, described the past six months as challenging for the company. “Conditions remained difficult due to the depressed levels of activity in the economy generally, and the printing sector particularly,” he said. “Volumes were significantly affected with anecdotal evidence suggesting the industry volumes were down by some 20 per cent.”

He does not expect a radical change in the economic climate. “Trading conditions remain difficult with volumes still below the levels of two years ago,” he said. “In response to these conditions, we are witnessing some aggressive market pricing as competitors seek to quit stock and maintain volumes.”

Debt stood at $39.3 million which, according to Cassell, is the lowest level in over two years. CPI’s finance facilities have also been renewed and now extend to February 2013.

Cassell added that following CPI’s recent reorganisation, it will embark upon further cost reductions as its warehouse rationalisation is continued over the next two years.

“Working capital will remain a major focus for the group going forward,” he said.