By Phil Boeyen, ShareChat Business News Editor
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Thursday 22nd November 2001 |
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CEO Jim Boult says recent restructuring initiatives, including reducing the number of staff from 740 to 580, have saved the company around A$6 million in costs and it is now on target to report an interim operating profit and a second half net profit.
Mr Boult told shareholders at RMG's annual general meeting on Thursday that although the first half of the year has been a difficult trading period from a profitability viewpoint, the company is now in the process of ironing out the bugs and working on the fine tuning of its new centralised business model.
"As a result by 31st December our business will be operating at a level of efficiency to comfortably take us into the second part of the current financial year.
"While the largest portion of our business by a substantial margin remains in Australia, we are very confident of a significant improvement in the performance of our business in New Zealand and have taken steps to ensure that our business in Malaysia, while not significant in overall terms, makes a small but acceptable contribution to group profitability."
Mr Boult says the company's distressed debt ledger business, which currently has a face value of around A$80 million, is profitable but the core business remains the commission the company earns from debt collection.
RMG chairman, Tony Hodgson, announced at the meeting that he will be standing down as chairman from the end of March next year in favour of Jim Boult, who will become the company's executive chairman. Mr Hodgson will remain with the company as deputy chairman.
The new CEO will be the company's chief operating officer, Adrian Mitri.
Mr Hodgson also told shareholders that they company has finally made further headway in New Zealand on providing credit reporting services between power companies.
The concept was launched almost a year ago but Mr Hodgson says the process of creating a database was slowed "primarily as a result of an enormous number of changes in the ownership structure of the energy companies involved."
However RMG has now signed up the last outstanding power supplier and says the database will start operating and a revenue source for the company from December 1.
"This has been a major coup for the company in that it represents the first significant step in creating an information database which is one of the major areas of business RMG will look to develop in future years," says Mr Hodgson.
RMG was formerly Frontier Petroleum but relaunched last year as a credit and receivables business.
It had its work cut out from the start, having to integrate some 22 separate businesses into a profitable whole. The process has not gone smoothly and former Baycorp boss Jim Boult was brought in this year to try to improve the operational structure and take the company into the black.
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