Reorganisation takes shine off Promentum profit

The news follows the shock resignation last month of managing director Alistair Hill, with management adviser Ian Parker taking the reins as the search for a new CEO gets underway. The reorganisation is related to Promentum's troubled Queensland operations, which the company claims have significantly impacted its earnings for the 2005/06 financial year.

Promentum claims these struggles were addressed earlier this year with the purchase of the Scanlon and Octane printing businesses in Brisbane. The subsequent restructuring across the state saw the company close its manufacturing facility in Cairns and shed 46 of its Queensland workers. These actions shaved $1.6 million from Promentum's bottom line along with other intangibles to the value of $2 million, causing its 2005/06 profits to plunge to $6 million.

With Promentum's strategic review complete the group expects the rationalisation of its Queensland operations to deliver $2.4 million worth of annual savings as well as an additional $2.7 million across the country due to other restructuring initiatives.

“The company is continuing to respond positively to the highly competitive nature of the sheetfed printing market and the resulting ongoing pressure on margins, through its strategy of being a low cost, well equipped, high quality producer,” it was claimed in a statement issued by Promentum.