Quebecor plans UK fightback

Quebecor World has no intention of ceding its position in the UK web offset market and is pursuing an aggressive sales strategy to replace the Associated Newspapers work.

As the group announced its Q2 results, president and chief executive Pierre Karl Pladeau stated: "We are currently putting together a sales strategy to replace this volume at our Corby facility. We have a little less than a year to find a replacement solution. We're already working on it and have identified many customers.

 

"The newspaper supplement market in the UK is huge and we look forward to putting this equipment to the service of other Fleet Street publishers," he added.

 

Pladeau also revealed that Associated Newspapers had asked Quebecor World to set up a greenfield gravure site in the UK: "We declined because we determined it would be detrimental to our profitability going forward... We didn't really understand what they [Associated] were looking for in terms of a gravure solution because we'd been doing a great job for them."

 

Quebecor World's contract with Associated, which accounts for some 60% of its UK turnover of 87m, ends next May. Polestar won the bulk of the work last month in a move that involved a switch to gravure printing for some of the supplements.

 

UK managing director Andrew Parker said the firm was not restricting itself to the newspaper sector and was "looking at some interesting opportunities it's quite surprising actually the opportunities that may be around.

 

"The good news is we have a good reputation in the industry and that should stand us in good stead," Parker added.

 

Along with its results, Quebecor World also announced that it is likely to close its Stockholm gravure plant, which employs around 150 staff. The presses may be redeployed within the group.

 

The group's performance in Europe improved, largely due to a turnaround at its previously loss-making French wing, which "didn't make money but is close to break-even".

 

It also announced a massive investment in its North American operations, which will involve the installation of 22 new wide-format web offset presses over the next three years.

 

Second quarter net income prior to exceptional charges was $50m (27.6m), compared to a net loss of 550,000 in 2003, on static sales of 849m. Operating margins rose 4.4% to 7% year-on-year. Pladeau said the results were "attributable to our stringent cost containment and cost reduction initiatives as well as our efforts to improve productivity and efficiency across our global platform", and added that they were "still not good enough, but getting better".

 

Story by Jo Francis