In a statement to the ASX, PaperlinX said that local paper manufacturing concerns had been “negatively impacted in recent months by the stronger A$ and softer pricing across many export grades”.

“Merchanting expenses show a significant favourable variance versus the prior year and prior expectations through successfully targeted cost reduction programmes across all regions, but are insufficient to mitigate the worse than expected market driven volume weakness seen in the last six weeks of the year in Europe and North America,” the company claimed.

However, the company does expect to have reduced its net debt from $327m to somewhere between $220m and $250m due to “strong progress on working capital reductions and cash management in the second half”.

The company said that publication of its final results for the year would be delayed until the end of August due to the recent sale of its Australian Paper business to Nippon Paper.

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