Ailing paper merchant PaperlinX has incurred another loss but says its financial performance is improving.
PaperlinX made a net loss of $90.2 million in the 2012/13 financial year, an improvement on a $266.7 million loss in the prior year.
The previous year’s loss included $214 million in losses from asset writedowns, business sales and restructuring costs, while costs from restructuring and asset writedowns in the 2012/13 financial year totalled $51.7 million.
“2013 demonstrates that we are delivering our turnaround strategy,” PaperlinX chief executive Dave Allen said.
The company shed 600 staff in the year, about 12 per cent of its workforce.
Those cuts and other initiatives to reshape the business are expected to deliver permanent cost savings of between $35 million and $40 million in the 2013/14 financial year.
The company said it will also seek more ways to cut costs in the current financial year.
PaperlinX also expects to benefit from diversification into more profitable products in the signage and display and packaging sectors, as its commercial print business continues to decline.
Mr Allen said PaperlinX would return to profitability at an underlying level, or when one-off financial items are excluded, in the current financial year.
“Very difficult decisions have been taken, but we are confident that these pave the way to profitability for the group,” he said.
PaperlinX made an underlying loss of $21.4 million in 2012/13, up from an underlying loss of $27.2 million in 2011/12.
The company’s shares were down 0.6 cents at 5.3 cents at 1235 AEST.