Sales: $85 Million
Description: Key Personnel
Suominen Corporation: Heikki Bergholm, president and CEO, Esa Palttala, executive vice president, Wipes and Nonwovens; Juha Henttonen, vice president, Flexible Packaging; Pekka Rautala, vice president, Wet Wipes Business Unit, Arto Kiiskinen, vice president, CFO. Suominen Nonwovens: Sakari Santa-Paavola, commercial director, Teppo Lainio, production director, Margareta Huldén, product and process development director
ISO 9001, 14001 environmental certification
Hydroentangled, thermal bonded
For Suominen Nonwovens, net sales dropped 9% to $85 million in 2005 compared to $93.5 million in 2004 as sales volumes were affected by challenges to branded wet wipes manufacturers in Europe. “Both the trend in sales prices and continued strong rises in the prices of oil-based raw materials and energy eroded financial performance,” said Sakari Santa-Paavola, vice president and general manager.
By technology, thermal bonded nonwovens lost ground to alternative materials in hygiene products resulting in a clear sales decline while volumes in spunlaced nonwovens were slightly better than the previous year. Despite saturation of spunlace in the European market, Mr. Santa-Paavola said wipes is still an important and viable business for Suominen, whose spunlace operation accounts for roughly 80% of its sales. “On the horizon of the spunlace business there is still new light in sight, mainly due to growth of its current product range and geographical expansion,” he said
While Europe remains Suominen’s primary market, the upswing in the usage of spunlaced nonwovens in the U.S. wipes market has meant good news for Suominen, particularly as the U.S. spunlace market is not as saturated at Europe’s.
“The U.S. is an important export market for us, Europe being Suominen’s main market area. Growing demand of spunlace in the U.S. has been positive news for the whole nonwovens industry. With the help of Suominen’s logistics solutions we have been able to act as a local supplier in the U.S.”
Suominen recently completed a debottlenecking project of its spunlace operation, increasing its capacity by 20% and allowing the company to efficiently process lighter nonwovens. Also to this company’s advantage is its ability to offer its customers individual products by having a large variety of PP, PET, PLA, viscose, cellulose pulp and cotton blends as well as a number of finishing techniques.
“Suominen’s wet wipes business is successfully rounded but there is still room for improvement. Integration is evolving according to previous plans,” Mr. Santa-Paavola added. Three years ago, Suominen forward-integrated into wet wipes production with the acquisition of Codi International, a Dutch wipes converter. In 2005, this unit produced about 100 million packs of wipes and net sales decreased by one-fifth. Challenges here included structural changes in retail business as well as generally slower growth in the marketplace.
In summer 2005, Suominen complete the final stages in the construction of a new product facility for wipes and since then all production lines have been operating at full capacity. In 2006, having finished rationalization measures, Suominen’s wet wipes business has begun to restore profitability. The target is to retain the marketshare lost during 2004-2005 and achieve growth particularly in personal care wipes but also in baby and household cleaning wipes, according to Mr. Santa-Paavola.
Much of this recovery has been achieved through research and development. “Suominen is constantly investing in product and process development to be able to offer its customers more innovative products and solutions. Pilot lines for each production technology (PP fiber, thermal bonding, hydroentanglement, converting and multi-layer film) makes it possible to run all development stages in house.
“By making good use of our competitive R&D, and raw material and process variations, we are able to offer our customers individual products. Close and continuous cooperation with customers and suppliers ensures that new and innovative ideas are brought to the market quickly.”