Oct 31, 2012

memories + thank you + to my critics + carpe diem

Posting #349
Posted October 31, 2012                                                      Twitter: @PaperlinXsuX

suX is winding down for the present, certainly not retiring but will remain ever vigilant. This post is a thank you and a few long overdue explanations and responses. No apologies, merely explanations.

Now PPX has a change of management suX intends to focus his energies on this blog's raison d'ĂȘtre. That is to restore value to the hybrid securities PXUPA. 

Hopefully the new board will accept its obligation of a duty of care to this important class of equity holder. We shall soon see.

The new board deserves a honeymoon period. It is presently a small target with no apparent skeletons in members' respective closets. The new CEO deserves a honeymoon too. After all Tom Park had 6.5 years and Toby Marchant 21 months; although he should have been fired the day he first uttered "Milton Keynes". 

suX should give a new permanent CEO at least six months however if Dave Allen gets the gig then continuity will be assumed. Sorry Dave, but if you elect to screw me around then pay the price. Regardless, the punters will advise how he/she is progressing well before the FY2013 accounts. 

A blogger needs content. Poor old Harry and Toby were a blogger's gift that kept giving. No content means no blogging. 

To critics of my style. Fortunately we live in democracies. I'm entitled to publish what I like and you are free to read what you choose. No one every criticised the accuracy of content much of which was ground breaking and drove certain PPX senior people stark crazy.

It had an impact. Some say the style was abrasive. Good, because that was the intention. suX is tabloid without a page 3 girl, not broadsheet.

What I do know is that there were many regular loyal readers and contributors and we got the job done.

To my critics within PPX.
There was a common misconception, particularly in the UK, that suX was praising certain independent UK merchants to the detriment of PaperlinX. I was accused of "giving air" to the opposition.

This is nonsense, but understandable from an individual's point of view. Others with flash titles did that for you years ago. It started in 2006 to be precise. Now think about who was ascending to power at PPX then. 

To be more precise, the PPX acquisition of Buhrmann settled in November 2003 and EBB was expanding North within three years. 

Why? Because the smarties could see the flaws in PPX and its management.

By August 2012, EBB had completed its expansion North arriving at Glasgow, see EBB about to open in Hillington, Scotland. 

Concurrently Premier Paper was doing something similar, see Premier fills another UK leadership vacuum. It suX. For years Premier Paper only had a sales operation in Scotland then in early 2009, so soon after the acquisition of Premier by Beswick in March 2008, Premier opened a warehouse in Glasgow. 

Clearly Tim Elliott and Graham Griffiths are better operators than the lunatics that ran PaperlinX into the ground over nearly nine years and blew away nearly $2 billion in market cap in the process. I say "lunatics" in deference to a great thinker.

“Lunacy is to keep doing what you’ve been doing 
expect different results.” Albert Einstein

Most people, including successive "blue chip" boards of PPX, couldn't see reality for the clouds of bulldust billowing out of Northampton and then Milton Keynes. Premier and EBB didn't pay one dollar of goodwill while pinching former PPX strongholds. Don't blame suX for that.

suX was merely helping to remove incompetent management hoping that when PPX competes on a level playing field it'll make profits so as to pay distributions on its hybrid securities PXUPA. There could never be another motive.

In doing so I acknowledged industry veterans who "stuck to their knitting" and ran their businesses with prudence not ego. It's worth noting that Messrs Elliott and Griffiths are both accountants by profession - bean counters, cost managers ... hello, anyone paying attention out there. 

It may have caused some regrettable short term angst but in the absence of a better alternative it's worked. If you disagree, kindly advise me of a polite way to get rid of an entrenched incompetent senior management structure rife with nepotism. Saying "please" doesn't work. 

There were many armchair critics yet none were moved to act; which says more about them than me.

Thank you whistle-blowers. They came in all shapes and sizes. They hailed from UK, Europe including CEE, Canada, North America, NZ and OZ. 

After a while suX developed trustworthy sources and often spoke at length with them on the telephone. 

The main PPX defence was denial or lies. Several lies were published. Eventually the sordid truth came out. Unfortunately a lot of material could never be published as it was just too incriminating. Problematic lifestyle habits and extra marital stuff was outside my brief.

The most rewarding breaks came when suX was able to correlate seemingly uncorrelated information provided by two or more sources. Eureka! 

This process confirmed the Loch Lomond scandal after this priceless entry was found in the East Kilbride News (Glasgow). 

East Kilbride News - April 6, 2011.
Who in Melbourne reads the East Kilbride News? Me. suX left no stone unturned in pursuing the wrongdoings at PaperlinX.

Thank you whistle-blowers. 

The best leak ever? The person who sent me the entire UK & Ireland Contacts Directory maintained by Felicity Addis, HR Data Administrator - PPX UK

Look familiar?
What a resource for a sleuth checking out stories. It even had 654 contacts for Delivery Co including John Ball's DDI 01604 673478, mobile 07901 514728 and email of john.ball@deliveryco.co.uk. Now do you believe me!

It wasn't the most sensational leak, was unsolicited and could never be published; but it was ever so thoughtful of the whistle-blower and helpful to suX. I never abused it.

Probably the most sensational leaks were Toby Marchant's "Dear PLG" letters; February 3, 2012 and March 9, 2012 

which the awesome company secretary couldn't verify as being authentic. Gee, somebody must have really hated PPX management to leak those from within the PaperlinX Leadership Group (PLG). 

These two leaks and their denial by Orrsome gave suX the confidence to bat on. 

To those very stupid persons in senior management who prated about my sources - you were wrong and are no longer in office. Mission accomplished. 

My most enjoyable posting was undoubtedlScotland the Brave complete with music and lyrics adapted for PaperlinX. 

Hark when profit is falling
Hear, hear the clients are calling,
Loudly and proudly calling,
Down thro' the glen.
There where the board are sleeping,
Now feel the will a-weeping,
Oh for the spirits of the old paper men.

I love the Scots, used to learn the pipes as a schoolboy and would like to see the recently painted PPX facilities in Glasgow made ready for the directors' tour to Loch Lomond (via Glasgow) in late 2010. Toby, you have a lot to answer for.

To those who remain, carpe diem. I Received this email from an respected person in the UK paper industry and now belatedly publish it with his/her consent:

“30 Sep 2012

Hi Graham, heard last week that John Turner, Divisional Director - Graphic & Carton Board at PaperlinX UK had just resigned to join independent board specialist Warren Board.

John is a well respected and experienced person in the industry and is another high quality loss for PaperlinX. When will they steady the ship?

People like John and recently departed Paul French create a double problem; they no longer bring in business but actively, with their new companies, take it away from PaperlinX!”

The writer's concerns are well intentioned and respected. My view is more sanguine.

No one is indispensable; "what is, is"; and regardless of their position all employees fall into three classes at times like this:

  1. Those who desire to leave, and resign. We wish them well;
  2. Those who desire to leave, and cannot. They are a serious problem; and
  3. Those who wish to stay. Management then needs to decide if they deserve a seat on the bus, see Is this your bus?

Presumably Messrs French and Turner and their new employers know what they are doing. One cannot stop anyone attempting to improve their lot in life by legitimate means. Good luck to all four of them. Just as good government requires a strong opposition as an alternative government, good companies grow through strong competition.

The challenge has been to stop PPX acting irrationally and not to influence personal freedom.

suX poses this question for serious consideration. Why would talented engaged persons elect to leave PaperlinX now? Genuine new management devoid of nepotism is the dawn of opportunity for good people at PPX. It's probably the best "real" opportunity they've had in years. It must also scare the living daylights out of many others.

PaperlinX companies will still exist in some form in the future, either within PPX as profitable undertakings or sold to others who can better manage them. Either way their owners will still need good people.

The biggest problem for Andrew Price is non-performers who have no where to go and nothing to contribute by staying; and I get the impression there are still plenty of those still employed in key positions within PPX UK and Europe. This problem dwarfs any concerns about the future careers of Messrs Turner and French.

I expect the ship will lurch and skew, then steady but cannot tell you how or when. One day we'll wake up and see that PPX looks and walks differently. Everyone will then look back and think: "how easy was that!"

There is an interesting tweeter named Paper Man at @papernprint who describes himself as:

"Seller of papers to printers...how hard can that be!!"

He also quotes Peter Drucker: "Management is doing things right, leadership is doing the right things." I hope he works at PPX UK.

Finally, with respect to my correspondent's closing comment; he/she is making assumptions. They are "glass half-empty" styled assumptions made out of genuine concern. suX could easily mount "glass half-full" styled counter arguments. 

But that's a waste of time, because "what is, is".

Oct 30, 2012

suX was resting not retired. Is this your bus?

Posting #348
Posted October 30, 2012                                                      Twitter: @PaperlinXsuX

Who's on the bus?
Answer below.

There's not a lot happening corporately at PaperlinX as we await the AGM in Melbourne on Thursday, November 15. 

Key current issues are:

  • Plans of the new board;
  • Appointment of a permanent CEO; and
  • What will be the permanent role of Andrew Price?

One would have thought these matters are pretty well settled by now, so "watch what people do not what they say" is the best plan for outsiders. Meanwhile ...

Andrew Price hops into Northampton to the surprise of many. Must have been to celebrate his birthday on October 28. For those who follow astrology he was born in 1963, the year of the rabbit. I suppose he'll be hopping into the job at Northampton. Oh dear, but more appropriate than the first first rabbit cartoon that came to mind.

suX offers a special mention to the first person who advises where 'Cut' Price is staying. Go on, he'll be pleased for everyone to know. Hopefully it's 3 star.

Marcus Gillioen, Exec VP Europe 1 has left PaperlinX. He was responsible for mainland Europe ex Spain and was based in Amsterdam. Without having to worry about Spain, France, Italy and now CEE; nor profits it seems, this gig looked too good to last. Surely his departure was expected.

That leaves one survivor from management of 2008 - 11 inclusive. 

The winner is Dave Allen.

Way back on June 30, 2012 (four months ago) when he was then Exec VP Europe 2 responsible for UK, Ireland, Spain, Sth Africa and then Canada with the departure of Chris Creighton; suX said of Dave Allen: "This is a demanding and thankless role." Nothing since then, including Dave's bloopers, has changed suX's assessment.

Dave Allen will be remembered by suX as the man who tried to curtail free speech in the 21st Century by blocking the PPX network to this humble site. Problem is that it hasn't diminished the level of page views from the UK. Another forecast gone awry. ShuX.

Embracing change.

The senior management of 2008 are now all gone, see here;
The senior management of 2009 are now all gone, see 
The senior management of 2010 are now all gone, see 
here; and  
The senior management of 2011 are now all gone bar Dave Allen, see 
here.  Note that Allen and Gillioen didn't warrant a mention in 2010. 
Add to that list recent retirements of Messrs French and Lane-Ley and there's been a decent rout of senior managers. Most were probably years overdue.

If this degree of change concerns you, be sure to read this:

"Who" before "What"
You are a bus driver. The bus, your company, is at a standstill, and it’s your job to get it going. You have to decide where you're going, how you're going to get there, and who's going with you.
Most people assume that great bus drivers (read: business leaders) immediately start the journey by announcing to the people on the bus where they're going - by setting a new direction or by articulating a fresh corporate vision. [sound familiar?]

In fact, leaders of companies that go from good to great start not with “where” but with “who.” They start by getting the right people on the bus, the wrong people off the bus, and the right people in the right seats. 

Is this your bus?
And they stick with that discipline - first the people, then the direction - no matter how dire the circumstances. 

That was a brief extract from Good to Great by Jim Collins. If you are serious about any business or business unit turnaround then this concept is for you. More here. I'm not sure whether Andrew Price reads Jim Collins. Doesn't matter as the idea makes sense and has been described in many other ways previously.

The fault with PaperlinX all along has been management. I accept the print/paper industry faces challenges, however the major problem was never the litany of excuses trotted out by successive boards and CEOs. It's had the problem that's common to every failed business, big or small - management. 

Believe it or not, paper wholesaling is about the easiest business in the world. PPX has consistently stuffed it up. 

Yep, it's really that simple. 

Oct 18, 2012

Wanna hear some good news re FY2012 bonuses?

Posting #347
Posted October 19, 2012                                                      Twitter: @PaperlinXsuX

FY2012 Bonuses reinstated. A little birdie tells suX that the previous Board's decision has been overturned by the new Board. 

The money has been paid.

This makes Mike McConnell a double loser, again, as he was (is still?) Chairman of the Remuneration & HR Committee (appointed April 10, 2012). That's another story for another time as this is a good news posting.

Recall our leaking of this abomination on bonuses here and Dave Allen's leaked internal advice here. 

On this occasion suX has no leaked documents to reveal as satisfied employees never leak (memo Harry, Toby, Dave et al) however the "mail" is good.

Remember the old saying: Bad news circumnavigates the globe before good news has time to cross the street. At this rate suX will run out of material as good news is bad copy.

suX thought everyone, including the press and opposition merchants, ought to hear some good news about PaperlinX.

More good news. It is permissible to have two pieces on one day.

Earlier this week Gaby Berger, convenor of the steering committee of PXUPA Investor Group Supporters (PIGS) sent an email to Andrew Price about a matter between PIGS and the new Board. He received a response within hours referring him to the appropriate person. 

Wow! In the past it was impossible to even communicate with a director. Responses from Scoresby took several follow ups and usually took a long winded way to say "piss off". On one occasion suX received a delightfully written letter which took 147 words to say "No". That's awesome, if you get my drift.

I'm not suggesting that the whole world should deal directly with Andrew Price, but at least on this occasion Gaby Berger now knows who to deal with. 

Perhaps this concept of dealing with stakeholders could catch on. Suggest Northampton has a meeting to form a committee to appoint some consultants to review it. 

It's early days, but these are promising signs.

Oct 14, 2012

"PaperlinX in far better shape than 12 months ago."

Posting #346
Posted October 15, 2012                                                      Twitter: @PaperlinXsuX

"PaperlinX is in fact in far better shape than when I took over as chairman 12 months ago." says Harry Boon, here.

THE TRUTH:  PaperlinX is in far better shape than 12 months ago solely because Harry Boon and his crew have finally been forced out. 


  1. Of the 345 posts to date, the one that tops the pops for all time readership is The truth will normally do published on May 27, 2012; and
  2. A nearby second is Board revokes FY2012 bonuses published on Sep 3, 2012.

Does that tell you something Harry? Your arguments aren't supported by suX's extensive readership.

Smile Harry, the pain will soon go away.

ONLY HOPE: That the new board makes decisions based on commercial imperatives always backed by transparency and truth when dealing with its stakeholders. 

That will be a HUGE step forward. It's probably all that is needed.

The full quote above sounds reasonable until you examine some of Harry Boon's previous comments when faced with equally challenging circumstances - like hard facts.

As one who's examined every public statement by Harry Boon in recent times, I assess he is prone to: 

  • hypocrisy,
  • hyperbole,
  • embellishment,
  • exaggeration,
  • trivialisation,
  • piety,
  • blaming others,
  • resorting to popularism like 'bank bashing',
  • demeaning or intimidating others, and when all else fails
  • plain lies.

Unfortunately, for Harry Boon, suX keeps a research library.

Blooper #1 is piety: “There is a responsibility of directors on boards to keep remuneration relative to rewards to other stakeholders.” Australian Financial Review, July 6, 2012 - here.

BUT, in reality Harry Boon personally condoned these two acts:

Blooper #2 is a lie "I’ve been looking to top up but I really haven’t had a window to do it. I’ll need to buy a lot to make a difference at this price." Australian Financial Review, March 21, 2012 - here.

At this stage, Harry Boon hadn’t found a window to voluntarily buy shares in PPX since May 5, 2008; nearly 1,000 days earlier. This is clearly a lie, see Harry Boon's untruth, day 981

AND what is Harry Boon's definition of "a lot" for a man being paid $275,000 pa in fees AND after he narrowly survived an EGM called to toss him out AND was then receiving circa $1 million pa in fees. See 
Corporate Spin in overdrive at PPX - it suX. $19,000. WOW!

Blooper #3 is hyperbole: "Just because you own a house in the South of France doesn't make you an expert on Europe." said Harry Boon of Andrew Price at EGM1. Andrew Price doesn't own a house in France, and Harry Boon must have known it; or does Harry Boon simply shoot from the hip when it suits? 

Blooper #4 is trivialisation. Remember when Harry Boon said at the EGM: "we wont save PaperlinX by removing flowers from the foyer." Stupid trivialisation to avoid answering what was a serious question at the time. SHAME.

Blooper #5 is another lie:
 "no one's asked me to leave", see here. Harry Boon has a knack of saying things where those quoted are too polite to contradict him. Harry, Allan Gray voted against you at EGM1 as did nearly 50% of your owners. SHAME.

Blooper #6 is blaming others, which will be the centre piece of his current defence:  "this was not a ship that was sinking", said Harry Boon of Hastie.  He has a knack of resorting to stupid popularist sayings that ostensibly appeal to the common man - like bank bashing as seen below. SHAME. 

Then a plea for clemency: "We tried so hard". 

Imagine if suX told things heard "off the record". 

Vindication, UPDATED 16 Oct 2012

Posting #345
Posted October 15, 2012                                                      Twitter: @PaperlinXsuX

Updated October 16, 2012

"... the ASA is troubled by the billions which have been lost at Paperlinx and Hastie and believes Mr Boon’s public company director career should conclude."

A direct quote from the Australian Shareholders's Association's (ASA) voting intentions for the Tatts Group 2012 AGM, at which it will vote against the re-election of Harry Boon as a director and thus he'll lose his chairmanship of Tatts Group.

The quote is contained in Item 4(b) on page three, see here; where in 361 unambiguous words the ASA vindicates everything suX has been saying about Harry Boon over the past 10 months.

The ASA Monitor (analyst) for Tatts Group is no less than John Curry, a former Chairman of the ASA. He concludes by saying:

"The ASA urges professional proxy advisers and institutional shareholders to take a similar position [to vote against the re-election of Harry Boon as a Director of Tatts Group] in order to help create a culture of accountability amongst those who serve as public company directors in Australia."

2012 is becoming Boon's self-inflicted corporate Annus Horribilis

Just six months ago he held eight (8) directorship equivalents, according to the ASA's measure of workload of non-executive directors which ranks chairmanship as equivalent of three directorships. The ASA recommends a maximum of five (5) directorship equivalents. This automatically precludes holding dual chairmanships. See 
2.4 Directors, page 11. 

Today he has a tenuous hold on four (4) directorship equivalents.

By Wednesday, Oct 24, this could be reduced to one (1) and Friday, Oct 26, zero. That is the ASA recommendation.

ASA findings concur with ACSI warnings to Harry Boon published as early as 2009

The Australian Council of Super Investors (ASCI) is the peak body for institutional retirement savings in OZ with over 40 members who collectively manage over $300 billion in retirement savings. 

suX posted ACSI's views on directors' workload and Harry Boon specifically in an extensive report on Harry Boon titled It's all Boon published Feb 14, 2012. Yep, that's how I spent Valentine's Day.

A brief extract is available here. The question no one wants to ask is why was it permitted by his co-directors, institutional investors and others; and for so long.

The ACSI warnings were very clear about Harry Boon's excessive workload:

PaperlinX 2009 
PaperlinX 2010 
Toll Holdings 2009
Hastie Group 2010
Tatts Group 2009 - a must read

Does any of this sound familiar? In case you have forgotten, suX has been campaigning along these lines for eight months. It's comforting to have these views endorsed by the ASA action, albeit six months too late as the ASA voted against Price at EGM1.

16 Sep 2012   Harry Boon - you're fired

The Australian Shareholders' Association (ASA) is no loony activist group. It was established in 1960 to protect and advance the interests of investors. Today it's recognized as the peak body for private investors, more here.

Now watch Harry Boon try to defend the indefensible, his record.

Rememnebr back to March 20, just three days before EGM1. suX then depicted: Harry Boon digging a grave (for himself).

This was Harry Boon's greatest achievement in 7 months.

Harry Boon said that was offensive. IMO, it was far less offensive than his balderdash and lies; and far less offensive than the damage inflicted upon PaperlinX by holding on when reason said he should go. 

It's not personal, its about stakeholders' wealth. Remember that directors are servants of the owners. Yet another group of owners has spoken.

In Passing the baton at PaperlinX suX explained how most leaders overstay their welcome. Harry Boon should have done a "John Gorton" after a near tied vote at EGM1.

Just had a bad trot - it's everyone else's fault. Go on. Tell us again why you're so clever but blameless. Harry Boon is now finding out the hard way why we have rules in our society. I'm sure he considers himself a law abiding citizen, but what he's done is, IMO, the corporate equivalent of culpable driving.

Culpable driving is defined by law in Victoria, here. It causes the majority of trauma and death on our roads. Harry Boon has caused a lot of trauma for shareholders.

The ASX general meeting season kicks off in earnest this week. Blue chip companies are being challenged on many fronts. The establishment is finally being challenged by concerned investor groups. A summary in today's Australian Financial Review is here. 

How will mainstream media treat Harry Boon this week? He received a charmed run from the "establishment" leading up to and since EGM1, but the ASA is different.

Watch this space.