The Australian paper giant's pre-tax loss for the six months to 31 December 2009 was down from a loss of A$551.9m the same time a year earlier.

Turnover for the group in 2009 was A$2.74bn, compared with A$3.78bn for the same period in 2008. In Europe, turnover for the six months was A$1.8bn, compared with A$2.3bn a year earlier.

The results reflect a turbulent year for Paperlinx, which undertook a series of strategic restructuring moves last year, including its exit from manufacturing with the sale of its Australian manufacturing business Australian Paper to Nippon Paper Group in June.

Paperlinx chief executive Tom Park said that, while the underlying operating earnings remained weak, the company had made good progress in reshaping itself to secure its future.

However, he added that the UK was now the single largest market for the group, and warned that the market remained weak following the impact of the difficult weather conditions in January.

Dave Allen, vice president UK, Ireland, Spain and South Africa, said: "The bad weather had an impact across the whole paper market and, as a significant player in this, Paperlinx merchants were of course affected."

However, he said that, despite this tough start to the year, the business was expecting a recovery in the next few months. 

"In terms of Paperlinx's results, merchanting remains a profitable business. Growth plans in new market sectors include printer consumables with Total Print Supplies and packaging with our national packaging business Purple Packaging," Allen added.

"These create significant opportunities for us to increase the size and scale of our business throughout 2010 and beyond."

In September 2009, Paperlinx said its year-end total loss of A$798.2m reflected the "depressing global market" for paper merchanting.