DCT, it might be a good week for CKL, might start hitting into the 60s, with FX traders taking risk off and the AUD & NZD falling and Australian/ NZ consumer commodities such as iron, oil, milk, food (Aldi v WOW/WES) and electricity falling leading to strong rebouns n consumer confidence, everything that Alex Commins wanted when the results were released, please see below from the industry journal:
Managing director Alex Commins blamed lower sales on Cadbury’s decision to switch from cardboard packaging to flexible flow wrap, losing ColorPak $5m, and sluggish volumes and lower prices from other clients.
The report says the series of plant mergers are to reduce duplicate labour cost, downsize occupancy footprints, and use scale as leverage for improved input cost purchasing following its acquisition of CHH in 2011.
Commins says the company has reduced its staff from about 820 to 650 following the acquisition through redundancies and natural attrition.
He says original plants in NSW and Victoria were combined with CCH plants and relocated to bigger sites nearby to accommodate new equipment, but the company will keep the plant it acquired in Auckland, New Zealand.
“The last six months have been challenging for us, it’s no easy feat to integrate two large companies,” he says.
“We are building a strong platform for future growth and will continue to invest in equipment to underpin this aspiration.”
Despite the expenses, the company returned the same level of dividend to shareholders and expects revenue to return to normal levels in the future and improve with better market outlook thanks to a lower Australian dollar and rising consumer confidence.
“To have any growth in such upheaval is very challenging,” Commins says.
Alex Commins: ColorPak MD overseeing yet another plant merger.
CKL Price at posting:
54.0¢ Sentiment: Buy Disclosure: Held
