by Jenny Ruth
Blue Star reported sales of $569.8 million for the year ended June 30, slightly higher than the $569.2 million in the previous year and above the $568.9 million prospectus forecast.
The annual net loss rose to $84.9 million, which included $59.8 million in goodwill write-offs, from $75.6 million the previous year. Before tax and the write-offs, the operating loss rose to $24.9 million from $15.5 million the previous year.
It reiterated it expects earnings before interest, tax, depreciation, amortisation and rent and restructuring costs (EBITDAR) to rise 26.5% from the $42.4 million profit on that measure earned in the year ended June 30. The previous year's EBITDAR was $46 million.
The Blue Star prospectus forecast a $75.6 million net profit for the current year, boosted by the severe haircut bondholders took on their investments which saw the $137.3 million in principal and interest they were owed converted to a net present value of $44 million if all goes as planned.
Blue Star's auditors, PricewaterhouseCoopers, included an "emphasis of matter" clause in their audit report which says: "The ongoing concern assumption is dependent on the ability of the company and group to meet obligations" renegotiated with Blue Star's bankers.
Blue Star says print industry conditions remain "very challenging," particularly in the sheetfed part of the business, "but there are enough signs to confirm that Blue Star is on the right track and that measures undertaken by management to adjust to these challenges are working and should, over time, result in a meaningful recovery in Blue Star's profitability."
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