Industry News

Flexible-packaging market share is expected to generate an appreciable revenue over the next few years, driven by the widespread requirement of efficient packaging across the industrial, food & beverages, healthcare, cosmetics, confectioneries, FMCG, consumer goods, frozen foods, and personal care sectors, says a new study by Fractovia.

Consumers are increasingly preferring easy, convenient, lightweight, and efficient packaging, which will further boost flexible packaging industry. Global packaging expenditure was worth more than USD 400 billion in 2015, and flexible packaging market accounted for more than 20% of this revenue share. According to Global Market Insights, Inc., “Flexible Packaging Industry is expected to cross a revenue margin of USD 250 billion by 2024, growing at a rate of 5% over 2016-2024.”

Superior sealing, lightweight, enhanced elasticity, aesthetic appeal, thermal insulation, reduced wastage, and barrier against moisture are some the beneficial characteristics that are expected to boost flexible packaging market size. User-friendly features such as zip locks, spouts, and resealable seals have enhanced the popularity of flexible packaging products among consumers.

Flexible packaging industry in the healthcare sector is expected to register significant gains of 5% over 2016-2024, owing to the rising health awareness among the consumers along with favorable government schemes supporting the usage of flexible packaging products in healthcare. Changing customer trends towards aesthetically appealing items will propel the growth of flexible packaging market across the food & beverages sector.

Taking into consideration the regional trends, Europe flexible packaging industry is predicted to record a CAGR of 3.5% over 2016-2024. High preference for cosmetics, retail goods, and processed food will push the revenue. Germany and Russia are likely to drive the regional growth.

Rapidly expanding e-commerce sector across Vietnam, China, and India is anticipated to contribute significantly towards APAC flexible packaging market revenue, which earned a revenue of USD 35 billion in 2015. The industry is projected to register a CAGR of 6% over 2016-2024.

U.S. market, which was estimated at USD 30 billion in 2015, is projected to fuel North America flexible packaging industry growth. The swiftly expanding medical and confectionery sectors across the region are forecast to make substantial contributions towards the overall share.

Based on the materials, the industry is segmented into cellulosic, polymer, aluminum, and paper packaging materials. Polymer flexible packaging market, which accounted for a major share of the overall industry share in 2015, is expected to grow considerably over the years to come. High material demand subject to the properties of longer shelf life and cost effectiveness will push the revenue. Paper packaging market size, which recorded USD 15 billion in 2015, is also expected to expand strikingly. Rising utilization across the medical and pharmaceuticals sectors will lift the growth.

Four-side-seal pouches, pillow pouches, and stand-up pouches are the major flexible packaging products. Standup pouches are slated to collect a revenue of over USD 75 billion by 2024, driven by its reduced cost, high barrier features, and low material usage. Pillow pouches are likely to record a CAGR of 4% over 2016-2024 subject to high product preference from the dairy sector.

The Flexible Lidstock Packaging Market is expected to grow around 5% CAGR during the period 2016-2022, says a new study by Market Research Future.

The global flexible lidstock packaging market will be driven by growth in the flexible-packaging market majorly due to the changing lifestyle of the people that results in the rise in demand for ready-made meals with extended shelf life. The booming packaging industry is also contributing significantly to the growth of the flexible lidstock packaging market. Factors such as the rise in consumption of convenient packaged food & beverages, personal care products, and pharmaceutical is contributing to the growth of the market. Increased innovations in flexible lid stock packaging along with low cost is also adding to the growth.

Key Players
The key players of Flexible Lidstock Packaging Market are Amcor Ltd. (Australia), Bemis Company, Inc. (U.S.), Berry Plastics Corporation (U.S.), Mondi plc. (Austria), Sonoco Products Company (U.S.), EP Industries Ltd. (Alfreton, England), Wipak Germany GmbH (Germany), Anchor Packaging Inc. (U.S.), Coveris Holdings S.A. (U.S.) and Sealed Air Corporation (U.S.) among others.

Market Research Analysis
The packaging type is the most important for packaging of food, beverages, pharmaceutical products and others. Among all applications used for packaging, the food & beverage segment is expected to grow rapidly. The food & beverage segment also includes dairy products. The improved shelf life of the food and beverages due to barrier properties and valving capabilities is also expected to drive the growth of flexible lidstock packaging market for the food & beverage segment.

Asia-Pacific region is expected to dominate the flexible lid stock packaging market with the highest CAGR due to the rapidly changing lifestyle, increase in the disposable income, extensive growth in population, and the constantly growing packaged food industry. The increasing urbanization has led to the increased use of convenient and low cost flexible lidstock packages among the people, thereby driving the growth of the market.

Glendale, CA-based Avery Dennison Corp. has announced preliminary, unaudited results for its first quarter ended April 1, 2017.

“We are off to a strong start to the year, with solid top-line performance and double-digit earnings growth,” says Mitch Butier, Avery Dennison president/ CEO. “Label and Graphic Materials delivered another strong quarter; Retail Branding and Information Solutions continues to drive volume growth and improved profitability; and, within Industrial and Healthcare Materials, solid growth in industrial categories mostly offset the anticipated decline in healthcare.

“Our consistent achievement of our financial targets, reflected in another consecutive quarter of strong earnings growth and increase to our guidance for the full year, reflects the resilience of our market positions, depth of talent in the company, and strategic foundations we’ve laid."

First Quarter 2017 Results by Segment
Organic sales change refers to the increase or decrease in sales excluding the estimated impact of currency translation, product line exits, and acquisitions and divestitures. Adjusted operating margin refers to income before interest expense and taxes, excluding restructuring charges and other items, as a percentage of sales.

Label and Graphic Materials

• Reported sales increased 7.6 percent; on an organic basis, sales grew an estimated 4.9 percent. Sales on an organic basis increased mid-single digits in Label and Packaging Materials and increased low-single digits in the combined Graphics and Reflective Solutions businesses.
• Operating margin of 12.5 percent was flat to prior year as the benefits of increased volume and productivity initiatives were offset by unfavorable mix and higher employee costs. Adjusted operating margin of 12.7 percent was flat to prior year.

Retail Branding and Information Solutions

• Reported sales increased 2.0 percent; on an organic basis, sales grew an estimated 2.9 percent.
• Operating margin improved 130 basis points to 7.3 percent as the benefits of productivity initiatives and increased volume were partially offset by increased employee costs. Adjusted operating margin improved 140 basis points to 8.3 percent.

Industrial and Healthcare Materials

• Reported sales increased 2.0 percent; sales declined an estimated 1.3 percent on an organic basis. Sales in industrial categories increased mid-single digits on an organic basis, mostly offsetting the anticipated decline in healthcare categories.
• Operating margin declined 270 basis points to 11.1 percent largely due to the expected decline in sales for healthcare categories. Adjusted operating margin declined 250 basis points to 11.5 percent.
• The company expects the previously announced acquisition of Yongle Tape to close in the middle of this year.

Lux Global Label Co., a newly formed holding company backed by private-equity firm Resilience Capital Partners, has purchased certain assets from National Label, a Lafayette Hill, PA-headquartered, 103-year-old manufacturer in the labeling industry. Terms of the deal, which closed April 14, were not disclosed.
 
As part of the transaction, Resilience will commit significant financial capital to the new company. Resilience also has assembled a team of industry veterans to strengthen the new company’s operations and industry stature.
 
In connection with the agreement, Resilience has partnered with LBC Credit Partners, a provider of middle-market financing solutions, and The Kennedy Group, a supplier of labeling, packaging and identification solutions.
 
“The financial and operating investments that Resilience Capital Partners is making will enable the new company to continue operations and meet customer needs, building upon a century of excellence in labeling,” says Steven H. Rosen, co-CEO of Resilience Capital Partners.
 
Ron Cozean, the new company’s Executive Chairman, adds, “If you looked at the location of our headquarters, you would say we are an American company. However, if you looked at the location of our customers – from Europe to the Middle East to Asia – you would see that we are a global company. We have the scale, the distribution and the expertise to be a leader globally, and our job is to get there.”
 
The new company inherits a rich heritage and strengths including:

• State-of-the-art operations and facilities around the globe including: The corporate offices and largest production facility, in Lafayette Hill, PA; a production facility in Humacao, Puerto Rico; and a production facility in Singapore, as well as warehouses and offices around the world.
  
• Proprietary technology to fulfill the unique needs of the new company’s diverse customer base, including conductive labels that transmit currents for batteries; authenticity/security features that verify genuine pharmaceutical products and expose evidence of tampering; and metallic ink-based labels that provide superior product aesthetics while greatly minimizing the cost and environmental impact compared to older, foil-based techniques.
  
• Extensive capital investments, including $53.6 million during the past four years, that have established a global footprint of manufacturing facilities equipped with the latest production tools and products.
• Industry leadership in providing state-of-the-art solutions, including high-quality, custom-printed labels and related products, with technologies that enabled the company to offer capabilities that exceed those of its competitors; the company had optimized its operations so as to enable it to produce in excess of 20 billion labels annually, including 15 billion at its main Lafayette Hill facility.
• A proprietary deluxe graphic technology costing more than $10 million to develop; unlike other label providers whose process includes heating foil to provide a metallic effect, this ink-based technology provides buyers with a solution that not only is better-looking but also less expensive and less wasteful.
• Production facilities that, unlike other companies in the industry, use best-in-class machinery that employs the most sophisticated technologies and capabilities.
• A uniform manufacturing layout across the company’s production facilities, unique in the industry that enables it to produce a single graphic look for its customers in all of their geographic end-markets.
  

Following three successful show days this week, ICE USA 2017, the International Converting Exhibition, and the inaugural InPrint USA 2017, the Industrial Print Show, came to a close at the Orange County Convention Ctr. in Orlando, FL, yesterday.
 
More than 3,400 verified registrants came to the co-located shows, meeting the expectations of show organizer Mack Brooks Exhibitions, Inc. (Chicago, IL).
 
“We are very excited about how well InPrint USA has been received,” says Marcus Timson, co-founder of the InPrint show. “There is definitely a need in the largest manufacturing market in the world for a show dedicated to educating and offering solutions for industrial print applications.”
 
InPrint USA 2017 focused on connecting manufacturers who use print as a key component of the manufacturing process with leading brands in the fields of industrial specialty, screen, digital, inkjet and 3D technology print solutions.
 
Bill Lydick, PDS Equipment and an InPrint exhibitor, adds, “Our company sold three machines right off the show floor. We were thrilled with the visitors’ response, considering InPrint is a brand new show in the US market.”
 
ICE USA 2017, marking its fourth edition in the Americas, is North America’s leading converting exhibition, bringing 250+ exhibitors together with thousands of packaging, paper, non-woven and self-adhesive industry professionals.
 
“ICE USA is where people come to see converting equipment, and we definitely had more equipment on the show floor than ever before, 225 pieces to be exact,” says Melissa Magestro, exec vp-Mack Books Exhibitions. “This is definitely the place to come to see the latest technology and products, and the addition of InPrint on the show floor created great additional value.”
 
Joe DiSabantonio, owner of SPS Ideal Solutions and an ICE USA exhibitor, adds, “The quality of leads we got was higher than we have seen at other shows. Real decision-makers attend this event and come in looking for the type of applications we offer. We are expecting to close sales directly related to our participation in ICE.”
 
Highlights of the ICE USA and InPrint USA exhibitions included:

• Support from Latin American converting associations and industry media helped drive new visitors from the Latin American region which helped boost the total ICE USA 2017 attendance numbers.

• The first Global Industrial Inkjet Conference at InPrint USA was a big draw for both InPrint USA and ICE USA visitors with over 50 registered attendees.

• Both shows offered a mix of industry insights and projections, case stories, and troubleshooting technical education taught by industry experts, allowing visitors to take advantage of over 85 conference sessions.

• The Future of Converting Theater offered technical educational sessions on the show floor to share best business practices, M&A’s, sustainability, industry forecasts, and more.

• Economist Dr. Robert Fry delivered an insightful keynote presentation to an audience of about 100 with his outlook for the global economy in 2017 and beyond, with emphasis on US manufacturing.

• More than 30 companies took advantage of the popular “Ask the Experts” program at ICE USA, which offered complimentary strategic, operational or troubleshooting advice.

 
The next ICE USA and InPrint USA shows will be held at the newly renovated Kentucky International Convention Ctr. in Louisville on April 9-11, 2019.

More info: www.ice-x-usa.com

Izumi Totani, founder of Totani Corp. (Kyoto, Japan) died last month at the age of 94. A private funeral was held in Kyoto and attended by family and close friends.

Totani founded Totani Giken Kogyo Co., Ltd., in 1952 in Kyoto. The company was incorporated in 1961, later named Totani Corp. Izumi Totani led the company as president, overseeing the design, manufacture and sales of automatic bag- and pouch -making machines. He expanded the company and began to export worldwide into the Americas and Europe.

Totani retired from active leadership in 2001 and continued with the company as a member of the board of directors. Izumi continued to visit Totani headquarters one to two days per week up to 2014, often holding classes for incoming new employees.

His son, Mikio Totani, and grandson, Ryuichi Totani, continue to lead Totani Corp. as president and vp, respectively.

Chessington, UK-based Digital Electronic Products Ltd.  has recently commissioned a new coating line in its Runcorn facility to meet growing demand for DEP Coated Print products and to offer an enhanced capability to its Contract Coating customers.

DEP is a leading independent manufacturer and supplier of high-quality coated products. With a history stretching back over a century, DEP has precision cleanroom coating facilities in the UK supported by a highly experienced development and manufacturing team. DEP’s range of products for the print market, together with specialist contract coating capability, aims to meet the most demanding requirements.

The coating line is added to the existing ISO Class7 cleanroom coater and converting capability in the ISO9001 approved manufacturing site.

Jack Kahn, owner of DEP, comments, “Commissioning this coater in 2017, with Mayer rod coating, adds capacity and improves efficiency of our branded products used in the print and labeling industry. It has also broadened the coating technology offered to our contract coating customers, particularly those seeking self-wound and lower coatweight coatings."

The existing precision coating line will continue to manufacture products which require cleanroom manufacturing and handle higher coat weight products used in the Medical, Imaging and Security markets.

DEP technical mgr. Ian Sargeant adds, “We are excited to be able to offer new capability to our customers. Obviously the new capacity is important but, critically, it’s backed up by a team of operators and a technical team with extensive coating experience and a passion to ensure DEP offer the best possible service to our customers."

More info: www.depltd.co.uk

Neenah, WI-based packaging converting giant Bemis Co. Inc., today reported financial results for its first quarter 2017, ended March 31. Income dropped 9.1%, and earnings fell 6.8% compared to Q1 2016.

“We are clearly disappointed with our results this quarter, which were impacted by lower-than-expected unit volumes and operational issues in the U.S. Packaging segment,” says William F. Austen, Bemis president/CEO. “We are commencing a series of decisive actions and will execute a comprehensive plan to improve financial and operational performance in this segment. We are evaluating all aspects of our U.S. business – including our manufacturing footprint, SG&A, and direct and indirect spending – to better position the Company in the current environment and for the long-term. We are committed to providing additional details and updates as we make progress on these critical initiatives.

"Our Global Packaging segment met our expectations this quarter, driven by continued operational improvements in our Latin American and healthcare packaging businesses. We are pleased with the traction our new leadership is making in each of these businesses as they drive new ways of thinking, enact change, and deliver on our commitments.”

Initiatives to Improve US Packaging Operations and Profitability
As part of the Company’s efforts to improve the profitability of its US Packaging business, Bemis is developing a comprehensive plan that enhances focus and improves performance in its U.S. business while maintaining the high quality products, best-in-class service, and culture of innovation consistent with Bemis’ standards. Actions include:

• Strengthening the US Packaging leadership team. Bemis appointed Fred Stephan as President of the Company’s U.S. Packaging business in February. Fred brings significant experience and skills to his new role. He most recently served as Senior Vice President & General Manager of the Insulation Systems business at Johns Manville, a Berkshire Hathaway company. Fred successfully served in a number of general management and functional roles over the past 12 years at Johns Manville and during the previous 20 years at General Electric.
  
  Austen stated, “Fred is an outstanding addition to Bemis Company. He has a great track record of leadership and success, and I have already been impressed with his fresh insights, his drive for action and results, and his practical and simple approach to our U.S. business. I look forward to Fred’s impact on changing the way we do business in the U.S. and to the financial performance improvement that Fred will help drive in the long-term. I am personally committed to working with Fred to get our U.S. business back on track.”
  
  Bemis is also evaluating additional ways to enhance its U.S. organizational structure to promote accountability and efficiency.
  
  
• Optimizing manufacturing capacity. The Company is evaluating its manufacturing footprint and utilization in the U.S. to align with customer and end market demand and to ensure optimal operational efficiency. A plan will be announced during the second quarter and implemented during 2017, with benefits expected in 2018. In late March and early April 2017, Bemis eliminated approximately 200 manufacturing positions in its US Packaging business. The impact of this is included in the Company’s updated 2017 outlook.
  
  
• Further reducing cost structure. Bemis is taking actions to reduce SG&A expenses in the U.S. The Company is evaluating all administrative activities and costs and is accelerating its Global Business Services (shared services) initiative in the US.