While unveiling its third-quarter results, yesterday, Winnipeg-based Pollard Banknote Income Fund announced plans to close its production facility in Kamloops, British Columbia, by February 2010. The move is expected to save Pollard $4 million per year.
“While closing down any facility is a very difficult decision, we believe that it is critical that Pollard strive to be the lowest cost producer in our industry,” said John Pollard, Co-Chief Executive Officer. “The continued competitive marketplace makes this decision something that we are required to do to work towards that goal.”
Under the Pollard Holdings Limited Partnership division, the company is one of North America’s largest providers of products and services to lottery and charitable gaming industries around the world. The company believes it is Canada’s largest provider of instant-win scratch tickets and the third-largest producer of such tickets in the world.
Pointing to gains on foreign currency contracts, Pollard LP had sales of $48.4 million during the three months, ended September 30, 2009, compared to $44.1 million in the same period last year. Gross profit increased to $11.4 million in the third quarter of 2009, from $9.9 million in the third quarter of 2008.
“Our new press implementation is continuing and production volumes produced on this press have increased significantly. Improved cost efficiencies will continue to accrue going forward due to the efficiencies gained from this new technology,” said Pollard.
“Based on expected variations in order patterns, we are anticipating lower volumes during our fourth quarter consistent with our experience during previous years. The instant ticket lottery market, however, continues to show good resilience during these difficult economic times and our overall expectation is for this market strength to continue.”
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