Allprint Ainsworth Associates, a 34-year-old commercial printing company based in Kitchener, Ontario, filed for bankruptcy protection with company owner, Klaus Ertle, subsequently announcing his retirement.
After being contacted about the company’s pending closure or restructuring, printing-industry veteran Ertle responded via email that he is retired as of February 12, 2010.
On February 12, The Record news organization, based in Kitchener, published a story that Allprint Ainsworth had filed a notice of intention under Canada's Bankruptcy and Insolvency Act.
According to The Record, the bankruptcy protection notice was filed on February 5, with Toronto-based Farber & Partners Inc. being appointed as trustee in the case.
Klaus Ertle served as production manager at Ainsworth Press prior to founding his own company, Allprint, in 1976. Allprint acquired shares of Ainsworth Group from Southam Inc. in 1993 and then consolidated the two printing firms. The company employs around 80 people within a 50,000-square-foot plant.
Read The Record Article
Canwest has submitted and received an extension on its creditor protection in order to give the company more time to restructure.
In order to do so, the company submitted a request to extend creditor protection until to April 14. The court's protection was originally set to expire this Friday. Ontario Superior Court Judge Sarah Pepall approved the extension this morning as well as the changes to the newspaper auction plan.
According to the Canadian Press, a committee of noteholders has complained that the bidding process for Canwest LP is not robust enough. In response to this, the first phase of the auction has been extended a week, to March 5. The complaint was that the process gave lenders too much power in the auctioning process.
Bloomberg reports that 15 potential bidders have signed non-disclosure agreements to look into the newspapers' confidential information. Canwest current publishes 12 daily newspapers, including the Vancouver Sun, Montreal Gazette and the Ottawa Citizen.
Eastman Kodak has announced its fourth quarter earnings and it has seen a 45 percent increase over profits in the third quarter and a six percent improvement over the same quarter in the year previous.
"Despite a difficult economic environment, we delivered in 2009," said Antonio M. Perez, Chairman and Chief Executive Officer, Eastman Kodak Company. "Our momentum is returning and our strategy is paying off. During 2009, we generated significant traction with our key digital businesses, we achieved sustainable operational improvements across the company, our earnings improved substantially, and we ended the year with more than $2.0 billion in cash on our balance sheet."
The company, however, still incurred a net loss of US$232 million in 2009, compared to a US$727-million loss in 2008. Full-year revenue fell 19 percent, totaling US$7.606 billion.
Kodak achieved the results via a series of cost-cutting measures, including cutting R&D by 25 percent and Selling, General and Administrative expenses by 15 percent. Gross Profit margin was 34.4 percent of sales, an increase from 20.4 percent in the year-ago period. At the start of 2009, Kodak announced job cuts of 3,500 to 4,500 jobs, representing up to 18 percent of its payroll.
Bloomberg news reports that ASK Financial, a trustee for Quebecor World (renamed World Color Press in mid-2009), filed around 1,700 complaints for the return of US$390 million that the Montreal printer made in pre-bankruptcy payments.
After Qubecor World emerged from bankruptcy protection in July 2010, Bloomberg reports that ASK Financial began preparing some 1,700 complaints for the U.S. Bankruptcy Court in New York. The litigation is designed to retrieve payments that Quebecor World made – around US$390 million in total – within 90 days before filing for bankruptcy protection in January 2008.
Paper companies make up a substantial portion of ASK Finacial’s list, which also includes recognizable names like Heidelberg, Kodak and RR Donnelley. Proceeds from the litigation, according to Bloomberg’s report, will go to unsecured creditors.
Read Bloomberg report: Quebecor Sues UPM, Catalyst, NewPage for $55 Million
Xerox Corp. reported fourth-quarter total revenue of US$4.2 billion, which beat analyst expectations despite the fact this represents a 3-percent revenue drop relative to the fourth quarter of 2008.
Xerox’ profit in the fourth quarter of 2009 rose to US$180-million from US$1-million in the year-ago quarter. Total revenue for Xerox’ 2009 fiscal year came in at US$15.2 billion, down from US$17.6 billion in 2008.
"We delivered a strong close to a difficult year, with solid operational results that reflect our disciplined approach to generating cash and reducing costs," said Ursula Burns, Xerox CEO. "During the fourth quarter, we saw signs of improvement in several areas including developing markets, and we remain quite confident in our strong global competitive position.
“However, we believe revenue will continue to be under pressure until there is a more sustainable economic recovery.”
On January 20, Xerox announced the acquisition of Irish Business Systems for around US$31 million. By acquiring Irish Business Systems, Xerox claims it has gained access to more than 11,000 new customers in Ireland, primarily focusing on the small- and mid-sized business market.
Transcontinental Inc. released its fourth-quarter results (ended October 31, 2009), which saw the company grow 15 percent in operating income, despite a nine percent decrease in revenues compared to the same quarter in 2008. The company, in its 2009 fiscal year, saw an overall three percent operating income decrease and six percent decrease in revenues when compared to 2008.
“I am particularly proud of our operating performance in the fourth quarter — one of the best in our history — and the steady improvement in our financial results over the course of the year in very turbulent conditions,” said François Olivier, President and Chief Executive Officer in a statement. “We are making it through this serious recession by doing better than most of our main competitors and gaining back much of the ground lost compared to 2008."
The company saw a decline in the printing sector in the past year, with revenues dropping from $1.54 billion to $1.4 billion between 2008 and 2009. Its Marketing Communications sector rose from $341.7 million to $373.5 million.
Due to the North American recession, the company was unable to reach its goal of five percent organic growth in sales per year, which was set in its Evolution 2010 plan, introduced back in 2005. Instead the company shrunk 11 percent in 2009, compared to the growth of two percent in 2008.
“We also signed financing agreements for a total of $888 million despite the tight credit situation, and we did so at competitive rates," continued Olivier. "I see this as acknowledgement by investors of our financial credibility, as well as their confidence in our growth strategy and prospects for the future. We plan to maintain our prudent balance between profits, costs, debt and investments."
Koenig & Bauer AG today announced plans to cut an additional €300 million in costs by 2013 “to counter falling sales and accelerate a return to profit.” Claiming to be the world's third-largest printing-press maker, KBA is now seeking total cost cuts of €580 million, after originally announcing a 3-year target of cutting €280 million.
As a result of the new cuts, which will include some 300 more jobs, the company states that by mid-2010 its workforce will be at around 6,200. KBA reported a €87.1 million- loss in 2008.
"We must cut capacity," commented CEO Helge Hansen, in a press release about the new cuts, adding, "It's a tough business." The company’s statement explained that “printing-press sales are falling as Internet publications squeeze Western demand for newspapers and magazine.”
KBA also pointed to its strong growth in the Asian market, as Hansen said the company is now considering opening up a manufacturing plant in the region's largest country. "China and the other emerging countries bring in volume, but not necessarily profit," said Hansen. "They help retain jobs, but they don't help in terms of a positive balance."
KBA forecasts a 35 percent sales drop this year, when compared with 2007 levels. "There's no going back to the old levels," said Hansen.
After selling its Australia-based paper manufacturing interests to Nippon Paper Group of Japan, in February 2009, PaperlinX yesterday announced plans to close its Wesley Vale operation in Tasmania as well as portions of its Burnie operation in Australia.
These cost-cutting efforts will result in PaperlinX becoming a pure paper-merchant company, focusing on the distribution of various paper, large-format and packaging materials. The paper-manufacturing closures are expected to effect around 250 Australian jobs.
PaperlinX made the announcement as it outlined progress on “new regional asset-based borrowing facilities,” which is an effort to restructure its approach to obtaining credit facilities. According to a statement, since July 2009, PaperlinX has secured a US$40 million facility in the United States; a NZ$35 million facility in New Zealand; and is in the process of finalizing a C$50 million facility in Canada and a A$80 million facility in Australia.
Smurfit-Stone Container Corp. this week filed its plans for reorganization, which would see the company emerge from Chapter 11 in the spring of 2010. The company announced it would be seeking bankruptcy protection last January in both U.S. and Canadian jurisdictions.
Patrick J. Moore, Chairman and CEO, said, "The filing of our Plan of Reorganization and Disclosure Statement is an important step toward Smurfit-Stone's successful emergence from the reorganization process. Our employees, customers, suppliers and other supporters have been instrumental in our ability to reach this important milestone. We will remain focused on tackling the many challenges that remain ahead."
The company stated it has prepaid all of the $43 million in loans outstanding in the U.S. and expects to prepay the approximately $7 million remaining of the Canadian term loan by the end of December. Smurfit-Stone will also merge all the Canadian assets under one entity, which will be held as a subsidiary.
Smurfit-Stone's total assets had a net book value of about $5.28 billion and total debt of about $6.6 billion as of September 30, 2009.
Dr. Jürgen Rautert is leaving Heidelberg and its 4-person Management Board, as the press manufacturer prepares to split – beginning April 1, 2010 – into three new divisions: Heidelberg Equipment, Services and Financial Services.
Rautert joined Heidelberg in 1990 shortly after finishing a doctorate in mechanical engineering. He ultimately became responsible for overseeing sales within the company’s Management Board, a responsibility that now falls on the shoulders of CEO Bernhard Schreier. Rautert was appointed to Heidelberg’s Management Board in 2004 and was initially responsible for products, engineering and manufacturing before taking over sales in July 2008.
Under the new structure, Marcel Kiessling (on January 1, 2010) will be responsible for the new Heidelberg Services division, while existing board member Stephan Plenz takes charge of Heidelberg Equipment and CFO Dirk Kaliebe looks after Heidelberg Financial Services. (Schreier, again, is to look after the international sales network.)
Kiessling (48) has been with Heidelberg for 20 years, as he ascended to lead sales in Germany and then, in 2004, took over the North and South American sales regions as President of Heidelberg Americas Inc, which oversees the company’s Canadian operations. In 2001, Kiessling was appointed Chairman of the Management Board at Heidelberger Druckmaschinen Vertrieb Deutschland GmbH.
Heidelberg states its new corporate structure allows the company to “significantly expand” the new Heidelberg Services division. "We will expand our service portfolio and, in addition to our current range of services and Heidelberg spare parts, we will also strengthen our services in the areas of Saphira consumables, Prinect software and integration, and consultancy for print media companies," said Schreier.
HP reports that its profit increased 14 percent in its latest quarter, primarily because of cost-cutting measures and strong results in its Services division. HP’s Imaging and Printing Group (IPG), however, saw a 15 percent drop in sales over the quarter, relative to last year. Sales of its commercial printing equipment in the fourth quarter fell 38 percent, according to HP’s financial report, as sales of consumer printing units dropped by 14 percent.
Overall revenue generated by the company in Q4 declined by eight percent. More specifically, fourth-quarter revenue declined by three percent in the Americas to US$13.6 billion, while revenue declined 17 percent in Europe.
"HP’s solid performance in Services drove record profit and the accelerated pace in signings creates strong momentum going into 2010,” said CEO Mark Hurd. Services revenue increased by eight percent in HP’s latest quarter to US$8.9 billion.
Net revenues for HP's 2009 fiscal year came in at US$114.6 billion, which is a three percent drop when compared with 2008 results.
The U.S. Postal Service (USPS) yesterday released its 2009 year-end financial results, showing a net loss of US$3.8 billion for the year. In 2008, the USPS had a net loss of US$2.8 billion.
The 2009 loss comes despite drastic cost-cutting efforts, which the USPS claims to have resulted in US$6 billion in cost savings and a US$4 billion reduction in required payments for retiree health benefits. These reductions are largely the result of 40,000 “career USPS employees” being laid off.
"Our 2009 fiscal year proved to be one of the most challenging in the history of the Postal Service," said CFO Joseph Corbett. "The deep economic recession, and to a lesser extent the ongoing migration of mail to electronic alternatives, significantly affected all mail products.
"We undertook comprehensive cost-cutting measures across all areas of the organization," Corbett said. "Most notably, we reduced work hours by 115 million, or the equivalent of 65,000 full-time employees – a larger number than the entire workforce at more than 80 percent of Fortune 500 companies today."
Operating revenue for the USPS in 2009 amounted to US$68.1 billion, compared to US$74.9 billion in 2008. Total mail volume in 2009 reached 177.1 billion pieces, compared to 202.7 billion pieces in 2008, a decline of 12.7 percent.
In its report on the financial statements, independent auditor Ernst & Young emphasized that “questions remain about the ability of the Postal Service to generate sufficient liquidity to make all of its payments, including the US$5.5 billion retiree health benefits payment due on the last day of 2010.”
The USPS’ 2010 plan estimates a revenue decline of US$2.2 billion, a net loss of US$7.8 billion, cost reductions of more than US$3.5 billion and a reduction in mail volume of 11 billion pieces for the year.
The Reuters news agency late last week reported that Allianz SE and MAN SE plan to pay off the remaining debt of manroland, to provide the press maker with a clean balance sheet as it enters into the New Year.
Allianz Capital Partners, the private equity arm of Allianz SE, purchased a 65 percent stake of manroland in July 2006, while MAN SE continues to be a significant holder of manroland stock.
In a Friday newspaper article, published in the Frankfurter Allgemeine Zeitung (translated into English as the Frankfurt General Newspaper), manroland Chief Executive Gerd Finkbeiner said, "At the end of 2008, we had no net debt and soon we will be completely free of debt. Our owners will replace the remaining liabilities entirely with equity.”
In releasing its third-quarter results for 2009, Koenig & Bauer AG (KBA) states that “the export-intensive press-engineering sector has stabilized at a low level,” but the company “sees no sign as yet of a sustained recovery.” KBA also pointed out that demand for its sheetfed presses was better than expected over the past quarter, while there is a “persistent soft demand” for web and special presses.
KBA’s order intake for the first nine months of 2009 was €682.3 million, 32.1 percent below the Drupa-enhanced figure of €1.01 million for the same period the previous year. The company claims orders for its sheetfed presses picked up in April and “remained buoyant” in the summer. Its orders for sheetfed presses came to €149.4 million in the third quarter, up from €145 million in the second quarter. The total for the first nine months was €371.7 million, 24 percent below the prior-year figure of €489.3 million.
The volume of new orders for web and special presses fell from €515.7 million to €310.6 million – a difference of 39.8 percent. In terms of special presses, KBA however points to security printing as a bright spot. The company also pointed to China as a continued engine for growth as export levels there remained “relatively stable” at 83.4 percent, against 84.2 precent twelve months earlier.
European exports for KBA fell from 52.3 percent to 34.8 percent of total group sales, while exports to Asia and the Pacific increased from 19.1 percent to 23.5 percent. The figure for Africa and Latin America was above the company’s historic average, at 17.2 percent, while the percentage of sales generated in the North American market remained low at 7.9 percent.
A company statement explains that sales “will be a good 25 percent below the prior-year figure of €1.53 billion… due to an unexpectedly weak inflow of orders for multi-unit web presses.” KBA's president and CEO, Helge Hansen, said, “If the fourth quarter proves disappointing and we post a negative result for the year, it will be in the low single-digit million Euro range and would still represent a notable achievement compared to the performance of other players in the sector.”
Reporting financial results for the first half of its 2009/10 financial year, Heidelberg CEO Bernhard Schreier said incoming orders have stabilized "at the current low level" but that the company’s figures for the first six months are down significantly relative to the previous year.
"Incoming orders are bottoming out now, but we do not expect to see clear signs of improvement in the subsequent quarters of the current financial year,” said Schreier.
The German press manufacturer had incoming orders of €534 million in its second quarter (July 1 to September 30, 2009), which is slightly less than the previous quarter mark of €550 million. When considering the first six months, Heidelberg’s incoming orders of €1.08 billion fell by around 43 percent when compared to last year’s first six months, €1.87 billion.
Heidelberg’s weakened incoming orders were echoed in a second-quarter sales drop to €499 million, from €514 million in the first quarter of the company’s current financial year. In the first six months of the current financial year, sales declined by about 31 percent when compared to the previous year, moving from €1.461 billion to €1.013 billion.
According to Heidelberg’s financial statement, “As a result of low profit contributions due to weak sales, the cumulative figure for the operating result after two quarters was minus €128 million.” The previous year’s operating result was negative €45 million.
The company reported a positive free cash flow of just €11 million in the second quarter. In the first six months as a whole, free cash flow was negative €18 million, while the free cash flow for the first six month’s of the previous year was negative €273 million.
“Consequently, for the financial year as a whole, Heidelberg sales will fall well short of the figure for financial year 2008/09,” reads a company statement, forecasting the year-end for 2009/10. “As a result of the low sales volume, Heidelberg forecasts an operating result (excluding special items) of between EUR minus 110 million and EUR minus 150 million."
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