PaperlinX to meet or better its revised forecasts

PaperlinX is adamant that in spite of its recent highly publicised difficulties, it has tight strategic goals and a sustainable long-term future. The company guarantees that its fiscal results for the 2004-05 financial year, due for release on August 25th, will at least match or better the forecast delivered in April.

Chairman David Meiklejohn attributes the company’s difficulties to general cyclical factors within the economy as a whole, including weak economic growth, paper selling prices in the region and the strength of the Australian dollar.

Meiklejohn claims at the beginning of 2005 the company was confident that selling prices would improve and the Australian dollar would soften against the US. “This did not happen to the degree necessary to give the anticipated profit benefit in the 2005 financial year,” he says.

Robert Eastmant from Industry Edge, publisher of Paper To Paper Edge, argues that PaperlinX’s share price was marked down too harshly following the fallout earlier this year. “Though the announcement was handled poorly by management, the recent statements bode well for PaperlinX coming in above expectations for the financial year,” he says. “Such a result also points to the possibility of much needed upgrades to its Maryvale Mill.”