Royal cutting costs, repositioning for growth
It appears a transition period at building products giant Royal Group Technologies Ltd. (Woodbridge, ON) may be com...
It appears a transition period at building products giant Royal Group Technologies Ltd. (Woodbridge, ON) may be coming to a close with a decision to reposition to company’s strategy and focus, and the retirement of its founder Vic De Zen. In its fiscal year-end statements, Royal disclosed that a sale of the company had been pursued and then dropped, and that the company will be changing some of its product lines and foreign operations.
Royal has also added some new faces to its executive management team during 2003.
Royal ended the fourth quarter of fiscal 2003 on Sept. 30 with a net loss of $78 million, largely attributable to a decrease in sales revenue from U.S. denominated sales, and to a pre-tax charge of $116 million related to charges for Royal Building Systems (RBS) and Foreign Operations, plus costs associated with the pursuit of a sale of shares in the company.
Royal Building Systems and Foreign Operations will be repositioned to focus on Royal’s primary building products, with RBS as one of many products in the line-up. The company’s various building products are being repositioned to focus on home improvement products and certain niche profitable consumer and construction products.
Commenting on Royal’s fourth quarter results, president and co-CEO Douglas Dunsmuir said, "We continue to focus on various capacity utilization issues and cost curtailment measures across the Group, as well as our transition to increasing sales and marketing activities. The final impact of these strategic initiatives is no expected to be fully realized until the latter half of fiscal 2004, but progress is tangible, and is gaining momentum."