Paper merchant Spicers has increased its earnings in Australia, and across the group, despite a poorer New Zealand result.
The company performed strongly in Australia, with a 69.9 per cent increase in earnings from the pcp to $3.07m from $1.08m on sales which increased slightly to $103.7m from $102.8m, with Spicers attributing the profit rise to cost savings and improved trading performance.
Group net sales revenue was one per cent down from the pcp at $193.2m from $195.2m, with its print and packaging categories down 2.7 per cent, balanced by a 5.8 per cent growth in its sign and display revenue.
Print and Packaging was down to $152.9m from $157.1m while Sign and Display was up to $40.3m from $38.1m.
In Asia, underlying EBIT is 5.6 per cent up from the pcp, driven by increased sales revenue, while in New Zealand underlying EBIT is down 5.1 per cent.
Spicers 1HY statutory profit after tax for the period ending December 31 is $1.9m, a fall of $1.7m from the pcp, while earnings before interest and tax increased $1.3m, reaching $4.5m.
Restructuring formed part of the cost savings measures in Australia including corporate, saving $1m.
Profit after tax from continuing operations of $2.7m is 89.1 per cent up from the pcp.
David Martin, CEO, Spicers, says, “I am pleased to be able to report a significant increase in group underlying earnings for the first-half of the 2018 financial year, a result of our people across the group successfully executing against our strategies over the past year.
“As promised, we are realising cost savings in our Australian organisation by improving operational efficiency and streamlining administrative activities. Further, our structured approach to portfolio management and market engagement is driving improvements in trading and profit returns across all our product revenue streams.
“Our Asian operations have grown their revenues and earnings, particularly in print and packaging categories in Malaysia. Our New Zealand business continues to deliver healthy returns in flat market conditions, with the recent Sign Technology acquisitions contributing revenues and profits as expected.
“We continue to closely manage working capital and cash across all our businesses. Inventory levels have reduced in comparison to both June 2017 and prior year balances, driven by our focus on supply chain efficiency and return on inventory investment in every product portfolio.
“Over the past year we have made strong progress developing an efficient and learning organisation, while delivering on our promises to customers and shareholders. Going forward we will continue to focus on optimising operating returns and cash flows in print and packaging categories, while generating profitable revenue growth in sign and display and other new growth categories.”
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