Media Release – 26th February 2010
GUNNS’ PULP MILL GAMBLE – WE ALL LOSE
TAP Into A Better Tasmania said news today of Gunns Ltd’s 99 per cent profit slump will add further pain to workers throughout the Tasmanian woodchip industry, and worsen the plight of an already crippled sector.
It is now revealed that despite the best efforts of Tasmania’s Primary Industries Minister David Llewellyn, and the State Labor government, to sell woodchips cheaply, little has been achieved to alleviate timber workers’ job security and Gunns’ financial woes.
Gunns’ troubles will be compounded with the closures of its chip mills in Triabunna and Long Reach (Bell Bay) after Easter.
(See:
http://www.abc.net.au/news/stories/2010/02/26/2830728.htm?section=business )
“Gunns have gambled the future of the company, and the livelihoods of all its employees, for a pulp mill pipedream” said TAP spokesman, Bob McMahon.
“Gunns has locked itself into an unsustainable woodchip mindset fed by the reckless dream of an unaffordable and unpopular mill”.
“With only a $400,000 profit and share price at a 10-year low, Gunns would find it difficult to buy an average-priced home in Hobart, let alone be financially capable of building a $2.5 billion pulp mill,” said Mr McMahon.
With vastly diminishing local jobs estimates, massive job shedding at Gunns, public subsidies in the hundreds of millions, and the enormous economic risk the project poses – not only to Gunns’ shareholders, but also to the wider Tasmanian economy – the pulp mill project must be put to death once and for all.
“Why should innocent Tasmanians and our economy continue to be dragged along with this mess?”, said Mr McMahon.
“Both the market and the public have lost confidence in Gunns. It is now in the grip of financial death throes, and only a miracle, or a massive subsidy from David Bartlett, can save Gunns now,” he said.
Recent media reports have revealed Gunns’ financial problems include requiring public funds to pay for pulp mill pipeline infrastructure, being unable to find markets for its woodchip stockpiles, and a need for major redundancies to remain solvent.
Gunns shares were valued at $4.75 in 2005. Shares closed on Thursday 26th February at below 60 cents a share.
Website: http://www.tapvision.info/
Bob McMahon, TAP Into A Better Tasmania http://www.tapvision.info/
