Updated 19 May 2012 Twitter: @PaperlinXsuX
On Jan 2, we were still lamenting loss of the Dec 2011 distribution. Today the issue is survival.
Then, PPX was trading at 8.4¢, had an Andrew Price inspired high of 12¢ and is now 8¢. In summary, PPX is going nowhere fast without some external influence.
PXUPA holders have endured comparable prices of $17.89, $23.00 and closed on May 18, 2012 at $11.45.
What's going on? It is imperative that PXUPA holders stay strong as the forces of evil are at work.
Major Update: 2 January 2012
Well we didn’t get our Dec 2011 distribution, but it isn’t lost yet.
Now we have an indicative takeover from an unidentified PE firm.
PaperlinX as a business is in play. Cash registers will be ringing soon, but who gets their fair share?
What must I do now?
#1 Maintain the rage. Tell us what you think.
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If you do nothing, that’s exactly what you'll get from the PaperlinX
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ARCHIVE
The urgent problem for investors in PXUPA
There is still time for the board of PaperlinX to reverse its decision and pay the December 2011 distribution. If it isn't paid then the distribution is lost forever; because unlike conventional interest payable, distributions aren't cumulative.
Key question
Is PaperlinX
trading while insolvent, or are the directors simply unethical opportunists?
Contribute now
Suggested remedial action by aggrieved investors, individual or collective, is welcome.
Suggested remedial action by aggrieved investors, individual or collective, is welcome.
If it isn't libellous, it will be published.
Hi,
ReplyDeleteYou guys should have seen this train wreck coming. It has been evident for years that the company is failing and if you wanted an omen to prove this, look no further than this page which highlights atrocious management by PaperlinX's main supplier.
http://hancockwatch.nfshost.com/docs/09feb.htm
25% of Hancock's plantations were wiped out in one day. All of these plantations would have ended up at Maryvale. It was rumoured that this firestorm happened at around the same time that Nippon Paper 'took over' PaperlinX.
Perhaps a class action lawsuit?
ReplyDeleteIn the event of PPX being wound up, PXUPA holders would probably receive repayment at par. Can we find a legal avenue, given they propose not to pay the Dec interest even though they could, to place the company in liquidation. As has probably been mentioned elsewhere on these pages, it could be argued that PPX is not paying its debts as and when they fall due if the Dec payment is missed.
ReplyDeleteWell done.Great to see someone trying to reverse the wrongs suffered by PXUPA holders.The only winners at PPX are the staff,and the previous CEO in particular.I expect a lowball offer for my PXUPAs (have plenty) which I will not be accepting.
ReplyDeleteWell done – you post "3R's" hit it right on the head. That fluff piece in the Australian just looks like spin and motherhood statements. All of this is fact so I expect they can’t try go legal on you - I thought I’d look at the previous Annual Reports and google the company. Maybe you can get the Australian to report this
ReplyDeleteAs you said he was running the largest part of the business and since he took over Europe in 2008 it’s been on a rapid decline leading to losses – what’s the reward a Promotion and a pay rise whilst we get nothing. -
1) In 2010 Europe lost $9 million and in 2011 made $500k – that’s on revenues of something like $3 billion
2) Have a look at there major competitor in Europe – Antalis http://back.antalis.com/sitesweb/media/library/62978_1199_1299751026.pdf
In 2009 they made a Profit of Euro96 million, in 2010 they made a Profit of Euro 113 million – think they might have a reasonable strategy!
3) As our investment was for Income has Marchant stopped receiving an income – no he actually got a Bonus for making a loss – how do I get a job there! You can warp it up anyway you want about “keeping talented people” blah blah blah – PXUPA is not the Social Insurance arm of PaperlinX. Maybe the bonus or any pay rises should only be paid if a distribution is made to PXUPA first
4) So the person that was running the largest part of the business since 2008, gets promoted for making declining profits and continuous losses. So logically you should get prompted as c you have a clear and defined strategy – as you are running the largest part of the business for the last 3 years – oh no sorry we wont have that till June 2012 – so what been going on since 2008 or even November 2010 since he took over as MD.
5) Oh – I know – to really define the strategy you need plush offices
http://www.midlandsbusinessnews.co.uk/2011-03/commanding-views-for-global-paper-merchant-in-milton-keynes.aspx
http://www.pinnaclemk.com/content/gallery.php
Clearly paying us our distribution comes well down the priority line in the strategy
Good to keep this website going. It could become the best way for hybrid holders to act more collectively and more informed.
ReplyDeleteLets hope the recent price increases of the end products are enough to make up for low volume and the PaperlinX becomes profitable. Once profitable all sorts of options opens up to the company.
Without profit we are probably all doomed.
I maintain that the best outcome for PXUPA holders is for the company to be wound up asap. Contuinuing losses by the company brings that outcome closer. If the interest payments cannot be restored, we should consider how best to bring the compnay to liquidation. The assets are more than ample to repay the hybrid holders in full, but this current environment of modest losses and the company staying alive is going to keep us in this no interest situation for longer. A speedy failure of the company would be a good outcome for hybrid holders and banks, but not shareholders or directors. Its possible that assorted hedge funds who hold the hybrids will accumulate the shares to an extent that they can vote the board out and engineer a wind up of the company - the lower the ord shares go, the more likely they will give it a go. We could all participate in ord share buying if this starts to look likely. Keep an eye out for a change of ownership in Orbis's approx 20% holding of ord shares.
ReplyDeleteI see a corner turning for paperlinx and good riddance of Tom park. He has a history of stuffing up companys and walking away with huge payouts. Goodman fielder and Southcorp and Paperlinx to name a few. I have seen first had the change in paperlinx since he has gone and all for the better. PPX decided to start buying higher margin paper, froze pay rises. Added new growth measurements, had cost cutting around the board. Got rid of unessential employees and just not replaced some lost through natural attrition. They are also turning into a one stop shop for printers instead of just paper which is keeping them ahead of the competiton. And speaking of which the main rival was saved by a nz firm but is looking to offload it and wind it up. So that will leave ppx in a huge position. CPI is winding up and leaving a lot of printers out of pocket.
ReplyDeleteEd: Kindly tell us more about:
ReplyDelete"the main rival was saved by a nz firm but is looking to offload it and wind it up"
AND
"CPI is winding up and leaving a lot of printers out of pocket" Thanks
Approx 70% of PaperlinX business is from the UK and Europe.
ReplyDeleteThe market capitalisation is less than $50 million. But even if someone wanted to takeover the business, they need to pay out the existing debt, plus hybrids at $285 million. So a buy out, is out of the question.
At some point PaperlinX would be better listed on the London Exchange,but they need to be profitable. Hybrids would be realised.
I think the company will survive, but it is touch and go. Certainly closure of other paper merchants is good news, be it NZ or elsewhere. Internet selling of paper to the printers could become preferred to dealing with sales reps etc. Dealing direct with paper manufacturers can be difficult in small volumes.
I think there is a roll for middleman, like PaperlinX, and the profits could be good once the new pricing kicks in.
I do feel the directors, on request from the institutional ordinary shareholders, were planning to rip off hybrid holders via a low bid off market buy back, but that's now been exposed and is now off the table.
Someone should ask James Ore about competitor merchants going out of business over the past 18 months. PaperlinX is said to have increased their market share, so other paper merchants should be hurting depending on the overheads and debt servicing. Not sure James would be out to date on UK or European competitors.
Ed: Why don't you ask him and publish the results here. You are obviously knowledgeable about PPX.
ReplyDeleteThanks in anticipation.
Nov and Dec are the two busiest months for paper. Relationship between economic activity and paper volumes is strong. October paper volume have already been confirmed as being down. Uk and Europe Gomes are expecting low paper volumes in 4Q in 2011.
ReplyDeleteThese few months and following 4 months will be very trying times for PaperlinX and both PPX and PXUPA. If UK and European economies gets worse over the next 6 months, i think we can kiss a further 50% of our PPX and PXUPA share price goodnight.
At least pAperlinX has low debt, so insolvency will be held off.
We need to hope the new higher pricing and market share for PaperlinX holds. Hopefully their competitors roll over and die.
So yep, extremely high risk.
December is the quietest month for paper sales for the simple fact that it generally only consists of around 16-17 real trading days
DeleteHi Ed,
ReplyDeleteIf the French paper distributor Antalis being a subsidiary of Sequana is in direct competition to Paperlinx in the European market, who are the main competitors to PaperlinX in the UK???
Keep us informed of any more closures.
Check the News -conditional offer by PE company made today
ReplyDeleteHello everyone,
ReplyDeleteDecember 23,2011 just heard about this website.
Myself with securities in pxupa and ppx. down badly of course. Wish you well and will keep an eye.
With such staggering turnover, you would think they can make a profit or have huge savings, unless they have no clue and sell to all the bad credit risks, which someone else already commented on - "every printer who goes broke in the u.k. owes money to ppx" he obviously knew and the rest of us did not think about its implications.
A private equity company wouldnt put money in unless they saw a ten fold increase (see Austar, Burns Philp, etc) so there must be a potential there and the reward should be for those who invested in ppx in good faith, just to find out the opposite.
signed artusan.
Artusan:
ReplyDeleteRevenue is Vanity, Profit is Sanity, Cash is Reality.
Whistle blown!!!! Check your email!
ReplyDelete