Publication Printing–Not Business As Usual

Publication printers are rising to meet the demands of rapid technological change, competition from the Internet and the changing whims of publishers. Will 2000 carry a darker dawn for this segment? Yes and no.

BY MARIE RANOIA ALONSO

As 1998 came to a close, the outlook for the publications segment was bright, despite the consolidation of titles that impacted the market’s major players. Overall, the minds of the publications market called for continued growth for the segment throughout 1999, with particular emphasis on the hearty performance of the special-interest title.

In total, while the projection for the publications market going into 1999 was conservative, rather than bullish, a cautious optimism was clearly evident. The publications market would perform admirably.

Top 10 Publication Printers
  Company Segment
Sales
(millions)
Total Sales
(millions)
1 Quebecor World*
Montreal
$1,786.00 $6,160.00
2 R.R. Donnelley & Sons
Chicago
$1,300.00 $5,000.00
3 Quad/Graphics
Sussex, WI
$518.00 $1,400.00
4 Cadmus Communications
Richmond, VA
$341.00 $443.00
5 Brown Printing
Waseca, MN
$287.00 $355.00
6 Perry Judd’s, Inc.
Waterloo, WI
$175.00 $292.00
7 Publishers Printing/
Publishers Press
Shepherdsville, KY
$166.00 $166.00
8 Banta Corp.
Menasha, WI
$160.00 $1,340.00
9 GTC Transcontinental Group
Montreal
$103.00 $866.00
10 The Sheridan Group
Hunt Valley, MD
$101.00 $135.00
*Combined proforma data as of 12/31/98

One year later, what is the consensus on the publications market? How, in fact, admirable was 1999 for the key players in the publications field, and what projections are in store for the publications segment as the year 2000 comes into view?

Robert S. Pyzdrowski, president of R.R. Donnelley & Sons Magazine Publishing Services, contends the call for 2000 is one of radical change. “Consider the evidence,” he asserts. “In the main, magazine printing companies are not recovering their cost of capital. While most publishers are experiencing returns of more than 20 percent, most printers are only seeing roughly half that percentage of returns.”

Also, Pyzdrowski states, publishers increasingly view printing as a commodity, and printers must bear the brunt of this perception. This situation is not specific to the printing companies. Throughout the 1990s, the margin pool among suppliers—printers, paper companies and ink providers—has been shrinking.

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