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World News
Quebecor World posts big losses following sale of European arm
Struggling print giant Quebecor World has unveiled massive losses on the sale of its European division.
In June, the company completed the sale of its European arm (QWE) to Dutch investment company HHBV, which generated cash proceeds of $82m (£44m).
However, in its second quarter results it revealed a "loss of disposal" of $653m, representing the book value of the company prior to the deal and the subsequent writedown.
The writedown compounds a miserable quarter for the Canadian print company in which it reported losses of $77.7, compared to a profit of $10.8m in the previous second quarter.
Despite the poor results, president and chief executive Jacques Mallette said the group had made important steps "to preserve the long-term sustainable profitability" of the company.
Revenue for the first half of the year fell to $2bn, down from $2.3bn in 2008 – blamed by the company on lower paper sales, decreased volumes and continued price pressures.
It was also revealed that, of the cash proceeds totalling $82m generated from the sale of its European arm, $75m was used up in partial repayment of its $1bn debtor in protection loan, which was granted upon its filing for Chapter 11.
Quebecor World filled for creditor protection in January this year, at the same time it closed its only UK site in Corby. It currently has 24,000 employees across the globe.
Results in brief:
Second quarter revenues: $976m (Q2 2007: $1.1bn)
Net loss: $77.7m (Q2 2007 income: $10.8m)
Sale of QWE generated cash proceeds of $82m but loss on disposal of $653m
QW sold its European arm to Dutch company HHBV
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Comments
The Mighty wind - 21 August 2008
It is to be hoped that the european arm will now gain some form of stability under its new owners, the least said about its former owners the better.
Simon Biltcliffe- Webmart - 21 August 2008
It will be interesting to see the strategy that HHBV eventually decides on for the UK market. This will be a way down the line as it is predominantly a reaction to their domestic circumstances that this consolidation has taken place rather than some grandiose plan for global domination. Quebecor tried that & they have paid for the lack of clear thinking in this quarters results.
If Maury are part of it then we have a formidable print powerhouse just the other side of the Channel which will be waiting for the exchange rate to realign before making a significant move to the UK.
Simon Biltcliffe
MD
WEBMART
www.FreePrintSales.com
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