Plant Consolidation and Right Sizing Stabilize Company

200M

Annual Sales

50M

in Debt

Adplex - Rhodes, Houston Texas

Challenge


Multi-plant printing ad specialty and proprietary artwork layout software solutions developer. $200 million in revenues. $50 million debt.


  • Revenues were dropping for several years.
  • Ad specialty market shift from print media to the internet coupled with the Great Recession led to significant volume losses at each facility.
  • Company was slow to react to volume losses, which resulted in million-dollar operating losses annually and loan covenant violations.
  • There was a high probability the Company would lose its financing.

Solution


  • MorrisAnderson was engaged by the Company to perform a viability assessment and restructuring plan.
  • MorrisAnderson engineered a comprehensive crisis management, turnaround, and cash management strategy to re-engineer and right-size the Company.
  • Plant consolidations and corporate right-sizing reduced operating expenses by over a million dollars annually.
  • Accelerated development and marketing of the Company’s proprietary layout software to augment revenues and open new market revenue-generating opportunities.

Results


  • MorrisAnderson team identified cost reductions exceeding a million dollars annually.
  • Cost reductions, combined with the accelerated software development and marketing revenue program, resolved lender concerns and reestablished banking relationships, preserving all existing borrowing.
  • Management was able to return the company to profitability while generating sufficient positive cash flow to service all business obligations and debt service.
  • Re-established the banking relationship with the primary lender avoiding costly re-financing efforts.