Ovato has collapsed and called in FTI Consulting as administrators, leaving jobs at risk and affecting some publications.
The ASX-listed printing and marketing firm stopped trading on Thursday, before announcing the appointment of Chris Hill, Ross Blakeley and Ben Campbell as voluntary administrators, the Australian Financial Review reported.
“The administrators have been advised that ongoing volatile market conditions, the increased cost of raw materials, and legacy cost issues have continued to impact Ovato, leading to the difficult decision to appoint administrators,” a statement from FTI Consulting to the ASX read.
According to the publication, the company will continue to trade on a business-as-usual basis under the administrators as its financial position and viability is being independently assessed.
The administrators are set to meet with creditors in a meeting in early August.
The printers produced well-known titles such as Woman’s Day, Australian Women’s Weekly, Vogue, Gourmet Traveller, The Economist and a number of News Corp publications. It also printed catalogues for Harvey Norman, Coles and Woolworths.
Ovato is lead by chief executive officer James Hannan, while his father Michael Hannan sits as the current chairman. The Hannans control at least 26 per cent of Ovato.
Ovato also has sites New South Wales, Queensland, Victoria, Western Australia and in New Zealand.
In recent years, Ovato has faced plenty of uncertainty and last year the company’s share prices dropped nearly 70 per cent.
Marketers have been steadily adopting digital channels instead of print mediums, and the impact of Covid in China and Russia’s war on Ukraine have meant delays in supply and shipping from around the world.
In December 2020, the company cut 300 hundred jobs at its printing site in Clayton, Melbourne.
The company also lost business when Woolworths and Wesfarmers scaled back its catalogue printing and distribution during the pandemic, according to The Australian.