For sheer drama, few annual shareholders' meetings so far this year
could top the one held by Moore Corp., one of Canada's oldest and most
venerable blue-chip firms - now pushed to the edge of irrelevancy by the
digital age.
Angry investors lashed out at the former global
powerhouse in business forms, which lost a staggering $66 million (U.S.)
last year, accusing its board of directors of ``stealing'' from the
company pension plan and doing a ``lousy job'' of running the company.
The 119-year-old firm has been in trouble for eight
years and shows few signs of recovering as e-mail and other electronic
forms of communication overtake paper.
The fact the last chief executive, Ed Tyler, got $26.5
million in severance pay after presiding over a 75 per cent drop in the
company's share price didn't help.
"The directors have done a lousy job,'' Kitchener-area
retiree Philip Rason told assembled shareholders, who burst into
applause.
"I used to be proud of the Moore name,'' said
George Madill, a Moore retiree who spoke on behalf of 5,000 U.S.-based
Moore pensioners who have taken legal action against the company's plans
to extract a $165 million surplus from the pension fund. ``Now, I'm
ashamed of it.''
Moore's latest chief executive officer, Robert Burton,
tried to head off the confrontation by delivering a Bible-belt-style
inspirational speech before investors got their turn at the microphones.
"I know how upset our investors are,'' said
Burton, who took off his jacket and stood in his shirt-sleeves to
deliver his message centre stage in the Glenn Gould Studio at CBC
headquarters. But he said it was too early to host Moore's funeral.
"No matter what you read in the newspapers, we're
not dead. We're not being delisted (from stock exchanges). We're coming
back.''
A self-styled poor boy from southern Illinois who put
himself through college on a football scholarship, Burton said his three
priorities in life were ``my family, my religion, and now Moore Corp.''
However, he acknowledged Moore investors have heard
this all before. He's the third American turnaround expert the board has
hired in the last eight years in a failed attempt to restore Moore's
glory.
"I know a lot of you are saying to yourselves,
`Oh boy, here's the new one','' Burton said.
Several disgruntled investors said they were impressed
with Burton's presentation, but still angry with the board for past
mistakes.
Since 1997, Moore has spent $600 million restructuring
its business, written off nearly $370 million in bad investments, and
racked up huge long-term debts, said Rason.
"You shouldn't be here, Mr. Kierans,'' he told
the company's outgoing chairman of the board, Thomas Kierans. Rason also
blamed Bob Prichard, the former University of Toronto president, who has
been a director since 1997.
Kierans said most of the bad investments were made
under a previous chief executive officer, Reto Braun, before he, Kierans,
joined the board. He admitted, however, that he was involved in the
mistaken decision to hire Tyler.
"We, all of us, made the wrong choice,'' he said.
As for Tyler's severance package, he said, ``we're all sick about
that.'' The board had little choice but to honour its original
contractual agreement with Tyler, he said.
The board members have sffered financially, too,
Kierans added, noting that a third of each director's compensation is
paid in the form of Moore shares.
Meanwhile, Moore is facing a ``bitter fight to the
end'' over the U.S. pension fund surplus, Madill warned.
"I contributed to the original pension plan,''
said Toronto-born Madill, who worked his way up at Moore over a 30-year
career from printer's assistant to head technology planner in its
research division. ``Now, you're going to steal it from us. Don't you
people know better?''
But Moore's new executive vice-president of
operations, James Lillie, said the company believes it has the right to
withdraw the surplus amounts it contributed. The employees'
contributions will remain in the fund, he noted.
Burton told investors the company is on track to meet
its first-quarter financial goals and expects to cut its second-quarter
losses in half from a year earlier, to 8 cents a share. The company has
forecast a loss of 9 cents a share for the first quarter, 33 per cent
lower than last year's first-quarter loss.
Moore reports its financial results in U.S. dollars.
Sales of business forms and labels, which make up 87
per cent of its revenues, are up about 4 per cent so far this year,
Burton said yesterday.
He acknowledged the global market for business forms
is flat at about $10 billion a year as customers turn to electronic
methods of communication.
But he said the solution isn't to turn Moore into some
kind of new age Internet player. Instead, he said he planned to boost
profits the old-fashioned way, by cutting costs and trying to win back
lost market share.
"We don't need a vision. We're going to deliver
results. And those of you who sign up are going to make a lot of
money.''
He said he'd used a similar approach at World Color
Press Inc., a company he turned around and sold to Quebecor Inc. for a
tidy profit.
So far, under his direction, Moore has cut $100
million in costs and shed 1,300 employees, or 10 per cent of its global
workforce.
