Book Printing Outlook -- Consumer Confidence Key
Few Blockbuster Sales
Quebecor World reaped a mixed-bag 2008 on the book side. Education was strong for the first three quarters, but began to soften in the fourth quarter. Its greatest weakness is the consumer end, which clearly is tracking the economic slowdown. And, while authors like Stephenie Meyer continue to grow in popularity, there simply wasn’t any J.K. Rowling buzz to drive people into bookstores.
Children’s publishing enjoyed a very strong showing for Quebecor World, while religious proved to be steady as ever, a linchpin for the company’s Latin American platform. And as costs associated with exporting jobs with long lead times have escalated, turning to South America is becoming a more attractive alternative.
Sean Twomey, executive vice president of market development at Quebecor, notes the printer focused on investments in one- and four-color digital assets for facilities in Iowa, Massachusetts and Michigan. He adds that Quebecor World will be announcing new partnerships that leverage its growing digital base. In fact, the company has spent more than $100 million in capex to augment its print platform over the past three-plus years.
As for Clarke, he envisions an aggressive and successful Quebecor World from the start of 2009. “The application of our hybrid press technology fully matured in early 2008, and we’ve seen huge benefits and flexibilities,” he says. “It supports our product life cycle focus: speed to market. It’s supporting very aggressive supply chain targets from our major publishers in pretty much all of the markets that we serve.
“We continue, as we exit bankruptcy—hopefully in the first half of 2009—to be a very strong company from the standpoint of our EBITDA-to-debt ratio. Customers already recognize that and supported us with $2 billion of secured, long-term business. We’ve gone through a lot of turbulence in the past, restructured capacity and have taken ineffective capacity out, and we anticipate that’s going to be required by other folks. We’re going to come out of the tunnel first and, unfortunately, there will be people behind us that will have to meet with those challenges.”