05.11.06
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UK printers face slow growth and further restructuring
By Barry Hunt
The UK printing industry provides products and services to every business sector of the UK and makes a net contribution to the UK balance of payments, according to Research and Markets, based in Dublin, Ireland (www.researchandmarkets.com). Its report estimates that the UK market for printed products in 2005 was £13 billion ($23 billion), an increase of 1.6 percent from 2004. This confirms the fact that 2005 was a difficult year. Demand for printed products grew very slowly and in some sectors it actually fell. Printers’ costs continue to rise, especially for energy, paper and inks — but many are passing on these higher costs by charging customers higher prices. Meanwhile, severe competition within the industry is another constant factor that printers have to contend with. Therefore, profitability is weak even among the top tier of printers.
The UK printing industry is highly fragmented, with thousands of small and medium-sized firms. Out of nearly 12,095 companies, only 3.1 percent have sales of more than £5 million ($8.75 million). Only four UK companies have a turnover of £400 million ($700 million) or more. Indeed, 96.9 percent of the industry’s companies have a turnover of less than £5 million.
The issues affecting the industry remain pricing, skills shortage and keeping abreast of new technology. Given the low profitability, the level of investment in the industry is high. Another feature of the industry is its success in export markets in the face of strong competition from abroad.
Last year saw a large number of mergers and acquisitions and many more are expected this year. The report says some in the industry feel that 2006 is likely to prove a watershed, with some major restructuring taking place. The future of two of the UK’s industry leaders, Polestar and Communisis, is unclear. The first may well merge with another, while the second is up for sale. The advent of two mega-sized print factories — one of which began production in summer 2005 and the other due to open in April/May 2006 — is thought likely to trigger large-scale change in the industry.
The report forecasts that by the end of 2006 the printing market will have increased by around 2.1 percent to £13.27 billion ($23.23 billion) and by a further 1.9 percent in 2007. Thereafter, the market is likely to rise by around 2.2 to 3 percent a year until 2010.
Forum unites converters from Europe and India
India has a growing consumer-led economy and a strong inflow of foreign capital. Although there are serious problems with India’s infrastructure, both factors have helped to boost the country’s industrial base and its international competitiveness. All this adds up to ideal conditions for building markets for self-adhesive labels and related services, as many western suppliers and manufacturers and suppliers have already found. In fact Label Summit India, which took place in February in Mumbai, attracted more than 600 visitors from India and nearby countries. Its success was said to reflect the the booming Indian label industry, whose annual growth is projected at 20 percent over the next few years.
Against this background, the FINAT trade association has established a forum between the European and Indian self-adhesive labeling industries. The aim is to give small and medium-sized member companies in both regions opportunities for doing business with each other. The European Union’s Asia Invest program supports the forum, which will be organized in cooperation with the national trade associations VskE (Germany) and LMAI (India).
The move will culminate with face-to-face meetings between companies in New Delhi in December, but will start in August when members of the Label Manufacturers Association of India (LMAI) meet in Mumbai to discuss the practical aspects of doing business with European companies. FINAT plans to launch a web site for the project (www.euro-indialabel.com), which will allow interested companies the opportunity to pre-register and submit their company profiles. The organization hopes that about 80 small and medium-sized label printers and converters from both trade regions will form the core of the Euro-India Labelling Exchange, as the forum will be named.
Expansion for Ulster labels and packaging group
MSO Group, based in Belfast, Northern Ireland, has taken over Storey Evans, a pharmaceutical labeling and packaging specialist in Bradford, West Yorkshire, for an undisclosed sum. The company was one of the UK’s top three producers in its field and its acquisition is therefore expected to establish MSO as one of the UK and Ireland’s leading pharmaceutical packaging producers. The sale marks the end of a family ownership at Storey Evans that goes back to the late 19th Century. Its labeling division was formed more than 30 years ago and accounts for around 25 percent of turnover.
Production of folding cartons and self-adhesive labels at MSO Cleland factory in Belfast will be boosted. Positive spin-offs are also expected for the Cartonmaster plant in Middlewich, Cheshire, UK. Two years ago it began to switch production from food packaging to the relatively more stable market for short-run pharmaceutical packaging.
MSO has also bought Hannibal Labels, a self-adhesive label producer with 58 employees based near Leicester. Despite, or because of, a long history of serving major supermarket groups and other blue-chip clients, the company slumped into administration. A series of failed management buy outs and takeovers could not turn it around.
Artwork forms three-way prepress partnerships
Prepress suppliers like to be buddies with everyone. They continually form new partnerships, which makes commercial sense given that today’s open operating systems allow communication between disparate input and output devices. It certainly forms part of the strategy of Artwork Systems, headquartered in Gent, Belgium. Over a brief period it recently signed up no fewer than three alliances with some leading graphics industry manufacturers.
An OEM agreement involving Kyoto based Screen and its global subsidiaries means that ArtPro pre-production tools are fully integrated within Screen’s Trueflownet. This suite of automated prepress modules include tools to create customized and automated JDF-enabled workflows to suit specific production requirements, including labels and packaging. In fact, Screen recently launched its first flexo product, the PlateRite FX870 digital platesetter using thermal technology for imaging plates up to 33" x 28".
Artwork’s arrangement with Punch Graphix International ensures compatibility between ArtPro, Nexus, and Odystar origination software and tools and Xeikon digital color printers, as well as basysPrint, the group’s manufacturer of CtP offset platesetters.
An agreement with Stork Prints in the Netherlands allows users of its direct laser engraving system to originate their label and packaging work on Artwork Systems’ Nexus RIP workflow system. Both companies will establish a working group assigned to develop the software and workflow systems for laser engraving technology.
Artwork Systems has offices in France, Germany, Ireland and the UK, with sales support in Australia, Argentina, Brazil, Mexico and Hong Kong. It recently acquired Enfocus and Dimensional Impressions and has a US office in Los Angeles.
Jetrion scores an inkjet first with European label group
Reflecting the growing interest being shown in the latest drop-on-demand ink jet systems, Reynders Etiketten is the first European converter to install Jetrion’s 3025 system. By employing two separate print heads, the system can print bar codes and other types of variable data at multiple locations on the press, while running at normal press speeds. By using a “read-and-print” option, Reynders’ press operators can print bar codes or sequential numbers in one location on the press, read this variable data further down the press, and then print a second variable code or number in a different location. The use of UV-cured inks allows the printing of most types of substrates at press speeds.
Reynders Etiketten is based in Boechout, Belgium, and comprises five separate companies: Reynders Pharmaceutical Labels; Reynders Etiquettes Cosmétiques, focusing on labels for cosmetics, personal care and luxury goods; Reynders Polska, serving Poland’s label market; Reynders Etiquettes France, specializing in labels for industrial applications; and Reynders Security & Specialty Printing. They have a combined total of 40 printing presses involving six different processes, including digital printing. Inline UV ink jet printing is seen to offer important new capabilities to the group’s operations.
“Drop-on-demand technology offers substantially more substrate printing capability than that offered by continuous ink jet, thermal transfer or the toner printing processes,” says Jason Oliver, Jetrion’s managing director for Europe. The system is ideal for applying durable images on high gloss and film materials for production applications that require higher quality bar coding, numbering and variable messaging on printed products.
The Jetrion 3025 was co-developed with Graph-Tech AG of Switzerland and incorporates that company’s MIC controller with image layout capabilities to simplify production of variable codes and marks.