I dont know the answer to that question Finch , but I do know that PPX operate in around 25 countries with over $4 billion in revenue , and somehow make a loss .
They have around 5000 employees and this makes up a massive component of their cost overruns which obviously must be reduced heavily , I think price at the EGM said at least 1000 people need to be cut if t he revenue number was 4b to be efficient , basically 1 employee for each m of income was his target , Toby didnt think it needed to be that significant a cut .
On the basis there is between 4000 and 5000 employees you would have to think a hell of a lot of them are in some form of accounts divisions , probably spread far to wide and double and triple reporting at a minimum up the large chain of command ultimately getting to the CFO , who gives the board their numbers
The new CFO spoke very well at the conference call and I suspect a lot of his focus will be in the area of getting the reporting more streamlined more accountable top down , and with a reasonable cost benefit saving , his track record speaks for itself as a turnaround CFO and this is a big positive .
No good spending to much of your income on employees who just are counting the numbers but you do need enough of them so you know the situation of your businesses at all times , probably weekly reporting I suspect .
I would hope in the strategic review Toby, the CFO , Andrew Price in his role as adviser focused on just what is the right mix of employees .
Management, accounts, operations , IT ,delivery ,legal .compliance,marketing are all important , but in my view having the best Sales team in all markets is the key to this business turning around
Get the best sales people selling products at margins that can turn a profit and everything else with a good management structure with less waste and fluff and PPX can be turned around
Hopefully someone on the board who directs the core management will recognize this before it is to late .
SRS Price at posting:
6.2¢ Sentiment: Buy Disclosure: Held
