White Pages a sunset business says PMP chief

Richard Allely predicts White Pages to die but is confident the Yellow Pages will not fade away anytime soon.

The CEO of Australia’s largest printer, which today reported earnings of $32.2 million – up 7.8 per cent on last year – defended the future of phonebooks which it has contracts to print after Sensis this week announced the lay off of staff following an 18 per cent decline in Yellow Print revenues.

“You have to split phonebooks into two groups: the White and Yellow Pages,” Allely (pictured) told Print21. “The White Pages is a sunset business – it’s not if it will cease, but when. I don’t see White Pages as something that will be around for a long time.”

Allely believes that the Yellow Pages is “an entirely different model”, though he has seen a paginations drop off within the small-to-medium enterprise market. “The Yellow Pages is a product that will be around for quite a while, particularly in regional and suburban areas,” he said.

In its 2011 first-half results, PMP’s print division revenues declined by 8.6 per cent to $246.4 million, with print volumes down by 5.8 per cent in the six months to December 2010. “The fall in volumes was largely attributable to reduced pagination and print frequency from existing customers,” Allely explained.

In spite of this, the print division still managed to increase earnings by 25.4 per cent due to lower operational and input costs and freight efficiencies. “The outlook for the second-half is positive and is underpinned by solid contracted volumes,” Allely added.

He predicts that volumes this year will stay “pretty static.” “Books will be flat, directories and magazine volumes will be down, but catalogue volumes will be better,” Allely said.

Fierce price competition and lower volumes in New Zealand meant that revenues continued to decline. However, first-half earning were $2.8 million, up $0.1 million compared to last year.

Late last year, PMP announced a major down-sizing of its NZ operations and is currently in the process of moving and consolidating five sites into one Auckland-based site.

Looking ahead, Allely expects full year earnings to be in the range of $56 to $60 million. “We plan to pursue market share gains in the Australian letterbox distribution business and earnings momentum in Australian print,” he said.