The company told the ASX: “Volumes are significantly below last year and below our expectations in Europe and the United Kingdom.”

However, it said that it had managed to maintain market share in Europe, UK and North America, and has “implemented some price increases in these markets”.

According to Paperlinx, the combination of the high Australian dollar and the company’s strategy of not pursuing “riskier, lower-margin business” are to blame for poor results in the “already depressed” local market.

A loss in the predicted range of $23m to $30m would still be a marked improvement on the 2010 financial year, when it recorded an after-tax loss of $225m.

It expected underlying post-tax earnings to sink $7m-$14m into the red.

The paper giant has extended the maturity on its largest borrowing facility from May 2012 to September 2013.

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