IT'S open season for "strategy" or "transformational" reviews that involve little vision but lots of sackings and management waffle.
Tim Boreham, Criterion, The Australian - June 27, 2012
This opening comment sums up the OZ reaction to the Strategic Review that apparently Toby Marchant and UBS have been toiling over since September 2011; yet it was delivered by the soon to be departing James Orr with a solitary comment by Harry Boon.
Rather than "strategic" it read more like a perfunctory ASX release, sans Toby Marchant.
published in The Australian yesterday.
A quote to warm your interest:
For Paperlinx holders, patience has worn as thin as a sheet of 50-micron copying paper that can, in the wrong hands, deliver a lethal paper cut.
Boreham is a regular watcher of forestry and paper companies and has a nice turn of phrase, meaning he is knowledgeable and easy on the eyeballs.
Other Boreham comments about PaperlinX include:
20120626 Tim Boreham - PaperlinX promises ring hollow despite strategic review
20100819 Tim Boreham - Serial underperformers_ PPX and PMP
20090901 Tim Boreham - Gunns (GNS) PaperlinX (PPX) Pulp and Paper
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Losing heads in the paperless revolution
The Australian June 27, 2012
As well as lopping heads, Paperlinx's review at least reflects on a seminal change: the paperless revolution is in train, with paper demand from commercial printers down 20-40 per cent over the past three years.
"Paper demand is expected to continue to decline by approximately 3-5 per cent per annum in most markets Paperlinx serves," the company says.
For Paperlinx holders, patience has worn as thin as a sheet of 50-micron copying paper that can, in the wrong hands, deliver a lethal paper cut.
And cuts are the order of the day as Paperlinx sells US operations Spicers US and Kelly Paper for $US76m ($75.9m).
Having chalked up a $20m first-half loss, the company now expects a full-year total reported loss of $171m. We last rated Paperlinx an avoid at 8.6c in October, after chairman Harry Boon promised "hidden good-news stories" in terms of market-share gains, reduced costs and price rises.
All we can say is the happy news remains well concealed.
Paperlinx has its debt under control and is still a big business revenue-wise, turning over $4 billion globally, suggesting there's scope for improvement.
But we've heard promises from Paperlinx since it demerged from Amcor and listed of hte stock exchange in 2000.
Our avoid call is maintained.
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