Narrow Web Europe

Fire sale in Germany, Renaissance in Italy

By John Penhallow | March 8, 2012

The Manroland saga continues to make headlines in the European press. The German press manufacturer, until recently a world leader, filed for bankruptcy in late 2011. Its three production plants, all in Germany, have been offered for sale separately, and at the time of writing, a UK-based investment company, Langley Holdings, looks set to acquire Manroland’s Offenbach site together with the defunct group’s sales network in 40 countries.  Around 860 jobs (out of 950) at the Offenbach plant will be saved, according to information from Tony Langley, sole owner of Langley Holdings “We see good commercial perspectives for the restructured company,” he said. His group had sales of half a million euros in 2011, but this is Langley’s first venture into the world of printing machinery.  Some commentators have suggested Langley may be looking for a “quick in, quick out,” selling the assets on to a mysterious and as yet unnamed Asiatic buyer, but for the present this is just a rumor. Another Manroland plant, in Augsburg, has been bought by Germany’s Possehl group, which is also said to be interested in the third plant. Of particular interest is the conciliatory attitude of IG Metall, the union representing Manroland employees, which voted to accept the various offers despite the job losses involved. Generous severance terms for dismissed workers, followed by Germany’s generous (by US standards) unemployment benefits, will help cushion the blow. No strikes, no lockouts, no lock-ins, just a cut and dried deal. This is the German way.

Three years ago, another press manufacturer, Italy’s Gidue, based in Milan, went bankrupt, but here the sequence of events was rather different. The company’s owners operated a skillful rearguard action of the kind permitted under Italian law, and resurfaced in Florence as Nuova Gidue with a slimmed-down structure. Despite the current economic climate, the company has just launched a new narrow web combination press for labels and packaging. The once-and-future CEO Federico d’Annunzio said at a presentation in mid-February, “With this new combination press, Gidue completes a three-year program to renovate its product offering. We now serve the labels and packaging industry, from narrow to mid web, with a wide range of innovative technologies to produce added value and high quality performance.” Like “The Birth of Venus” (Botticelli’s famous picture is in Florence) the new company is a re-born legal entity and, of course, not burdened by the need to pay the old Gidue’s creditors. This is the Italian way.

Super drupa?
Europe’s print and packaging calendar for 2012 revolves around two major exhibitions: the print show drupa in Düsseldorf in May, and the Emballage show in Paris in November. The drupa show, founded 60 years ago this year, is by European standards a mega-event. Nineteen exhibition halls totaling 1.7 million square feet of exhibition space, and all fully-booked according to the show’s honorary president Bernhard Schreier, boss of Heidelberg.

Narrow web specialists will find several familiar names exhibiting at the show, including press manufacturers Gallus, Omet, Rotatek, Labelmen, Stork Prints, Edale, Link Label, Focus Label Machinery and Gidue, digital printing equipment leaders HP, Xeikon and EFI Jetrion, not forgetting Durst and Epson. Other narrow-web equipment manufacturers at the show will include US-based Martin Automatic, Spartanics and Karlville Development, and Montreal-based ETI Converting. Recognizing that it is no longer sufficient to sit back and wait for the visitors to roll in, the show’s organizers will provide a number of  “specials,” including an “innovation park” for start-up companies and a Sustainability Show area offering “visitor information, live discussions and exciting presentations from experts and industry greats.” In case this isn’t enough there will also be special exhibits featuring “Functional Printing” and covering “…everything new and exciting which can enhance the print medium, such as decorative, visual, electrical and electronic functional characteristics.”

Health matters
Crisis or no crisis, people get ill, and when they get ill they make their way to the pharmacist (and nowhere more so than in France, which holds the European Gold Medal for pill-popping). Pharmaceuticals need labels, packaging and leaflets, generally printed (at least in Europe) in many languages. It is therefore no coincidence that some of Europe’s most prosperous label and package printers are those specializing in this end-user field. Take August Faller KG, which in 2011 clocked up sales of €100 million ($123 million), an 8 percent increase from the previous year. It’s not just because people keep falling ill, it’s the result of European Union legislation which requires the use of security labeling and packaging so as to make life harder for counterfeiters, and Braille to make life easier for the blind. Dodgy print quality is bad business in any sector, but for drug manufacturers a single print error can cost millions in legal damages. In Faller’s four plants, 100 percent inspection cameras pick up the smallest error (a misplaced decimal point can kill), and other inspection machines ensure that label, leaflet and packaging all refer to the same product. Leaflet and multi-page labels are used extensively to provide multi-language instructions. Faller also uses tamper-evident closures, holograms and the full range of covert and overt security features. All this has a price, and leading drug manufacturers are happy to pay good money for the kind of quality guarantee that converters like Faller can provide. Unusually for a label and packaging converter, Faller also provides a co-packing service for its customers, thereby discouraging them from “shopping around” for better conditions from competing converters.

On the other side of the Rhine, there is also one converter standing head and shoulder above the rest when it comes to pharmaceuticals. Autajon, with annual sales of €405 million ($530 million), reckons to be Europe’s fourth biggest supplier of pharmaceutical labels and eighth biggest in the market for pharmaceutical packaging.  Autajon has been traditionally a packaging group, but seized the opportunity to acquire one of Europe’s biggest label converters, Bopack, in 2009. Both Autajon and Faller complain of squeezed margins, partly due to the growth of generic medicines, and of reduced average run lengths as drug companies cut their inventories and insist on ever-shorter lead times. Here, as in other label sectors, makers of digital label presses are having a field day. Compliance with EU regulations and with industry standards are raising the barriers to entry for hungry converters eyeing this still lucrative sector. Compulsory braille inscriptions on all prescription drugs, introduced just recently, have been a boon for equipment manufacturers providing screen-printing equipment. Curiously, for a continent that for decades has enjoyed a single market, there are few truly pan-European converters specializing in pharma packaging and labeling. Faller has 90 percent of its business in Germany, and Autajon, while having plants in Benelux, Switzerland and Germany, still does most of its business in its home market, France.

UK press maker flexes muscles
Digital presses may be making the headlines, but the narrow web flexo sector is still very much alive in Europe. Mark Andy’s “Performance Series” for example has been riding to success in recent years, partly when the dollar was at its weakest. Today, Britain, with its high unemployment and (relatively) low wage costs is a good place to make label presses – at least, that is what Edale is betting; this medium-sized manufacturer recently moved to brand-new, larger premises near Southampton in Southern England. At the official opening of the new offices and workshop, the company demonstrated its FL 350 flexo press. Your correspondent, who was present at the inauguration, can report that this press performs well on set-up times, with servo drive and automatic re-register. It lacks some of the bells and whistles that you find on more sophisticated machines, but what you don’t get, you don’t pay for and this model compares favorably with others in its price range. According to company CEO James Boughton, “This opening event initially was planned to be fairly low key, but it soon snowballed with the end result exceeding expectations and a total of 20 key suppliers exhibiting, and a large number of visitors also attending the conferences held concurrently.” In the end, over 100 customers and distributors from all over Europe and from several countries in Africa and Asia attended the event. After the one-day Open House and ceremonial opening of the site, a second day was given over to technical training for Edale’s distributors.

HD Flexo made easy
Edale is one of just four press manufacturers (the others are Mark Andy, Gallus and Omet) certified by Belgium-based EskoArtwork for supplying HD Flexo plate imaging technology. Jan Buchweitz, senior product manager Digital Flexo, for EskoArtwork, says that HD Flexo delivers “Outstanding print quality with a straightforward plate production process. The high-resolution optics deliver more accurate, sharper imaging of text and line art, higher contrast and more detail sharpness in images, smoother tints, better ink film lay down and a greater color gamut.”How can all this possibly be achieved ? Many readers of L&NW will know already. For those who don’t, well, there are two answers, a short one and a long one. The long one is very long indeed, but the short one is “by making smaller spots and using a lot of fancy software.”

Greenery gains ground
Pressure from consumers and brand owners is making paper manufacturers look closely at their ecological impact. The FSC “Chain of Custody” system aims to check and certify compliance with good social and environmental practices. The latest to achieve FSC certification in Europe is Mondi’s release liner plant in Austria. According to plant manager Franz Pehn, the “FSC certification underscores Mondi’s commitment to sustainable development as an integral part of the business strategy. Other Mondi release liner plants are expecting to be FSC-certified in the near future.”

Labelexpo Europe and the battle of the Saturday
Since its birth over 30 years ago, the Labelexpo Europe show has opened on a Wednesday morning and closed the following Saturday afternoon. In the run-up to the 2011 event, the organizers Tarsus announced a switch to a Tuesday-Friday slot. Protests erupted from various quarters, the decision was reversed, and FINAT staged a special event on the Saturday to boost visitor attendance. The booster was apparently not powerful enough, and for Labelexpo Europe 2013 Tarsus has opted for Tuesday-Friday. FINAT is unlikely to cheer, and this decision will not find favor with many German converters; at the November 2011 meeting of the German label association, many delegates spoke out for continuation of the historic Wednesday-to-Saturday dates. Will there be another reversal? This time, probably not.
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