Paper merchant Spicers has reported a statutory profit after tax of $1.7 million in the 2016-17 financial year, a drop of $3.6 million from its result in 2015-16.
In its full year results, the company posted sales revenue of $380.7 million for the financial year, a 3.1 percent decline from the previous year. The $1.7 million profit after tax represents less than one percent of the company's sales revenue.
A drop in sales for the commercial printing sector was partially offset by a rise in sign and display, while growth in New Zealand and Asia offset a weaker Australian result. “While volumes continue to decline and trading conditions remain tough in our commercial print markets, it is pleasing to report that we have been able to deliver an increase in group underlying earnings with good results from our New Zealand and Asian businesses and a reduction in continuing corporate costs as activities continue to be rationalised," said David Martin, CEO.
Spicers ended the financial year with $31.8 million net cash, 3.8 percent higher than in 2016. “I am also pleased to be able to confirm an operating cash inflow of $6.3 million for FY2017, with the Australian business in particular delivering a significant turnaround on the prior year due to a strong focus on cash and working capital.
“Our changed approach to portfolio and product segmentation has delivered profitable growth in Sign and Display and other diversified categories, while we continue to focus on maximising our positions and returns in our Print and Packaging markets. I am confident this approach will also bring future growth opportunities as we move forward,” said Martin.
Spicers, formerly PaperlinX, this year resolved a deadlock with its hybrid shareholders, who have taken a 68.3 percent stake in the company. Chairman Robert Kaye and non-executive director Michael Barker will step down as part of the deal, which will see three new directors appointed in an extraordinary general meeting on September 6. The Board has backed its nominees, Malcolm McComas and David Stillman, over Todd Plutsky and Vlad Artamonov, two candidates put forward by New York private equity firm Coastal Capital, which held 19 percent of the hybrid securities. Former CEO Andrew Preece is also standing for a position.