Slide 1: Mondi Świecie
Mondi Świecie Maciej Kunda Investor and Analyst site visit, Syktyvkar and Świecie 2 – 4 November 2010
Slide 2: Agenda
Agenda Overview – Poland and Mondi Świecie SA Strategic focus and performance ECO 7 – success story Mill tour & safety rules briefing Investor and Analyst site visit, Syktyvkar and Świecie, 2 – 4 November 2010 PAGE 1
Slide 3: Poland
Poland Area: 312 685 km2 Mondi Świecie S.A. Lithuania Population: 38.5 million Main industries: coal, textile, chemical, Świecie machinery, iron and steel Belarus sectors Bydgoszcz Warsaw Forest land: 28% Germany Poznań Poland Czech Cracow Republic Ukraine Slovakia Investor and Analyst site visit, S
Slide 4: Macroeconomic indicators – Poland
Macroeconomic indicators – Poland Poland The only European country with a GDP (real) growth in 2009 = +1.7 %. 2003 2004 2005 2006 2007 2008 2009 2010 F Real GDP (change in %) 3.9 5.3 3.6 6.2 6.7 4.8 1.7 2.6 Unemployment rate (in %) 20.0 19.0 17.6 14.8 11.2 9.5 11.8 11.6 Inflation (avg in %) 0.8 3.5
Slide 5: Mondi in Poland
Mondi in Poland Poland Powerhouse in Central Europe Operations (10) Containerboard (1) Kraft Paper (1) Corrugated Packaging (5) Industrial Bags (2) Mondi Mondi Consumer Bags & Films (1) Packaging Świecie Szczecin Containerboard capacity Mondi Mondi Packaging Testliner: 600 000 tonnes Packaging Solec
Slide 6: Over 40 year history
Over 40 year history 1960 1967 Dissolving Pulp Plant 1970 – 1976 Start Up of 5 PMs 1972 Kraft Pulp Plant 1976 NSCC Plant 1991 Transformation into Joined Stock Company 1992 Restructuring 1997 Privatisation Mondi 60% 1997 – 2003 New strategy implementation 2008 – 2009 ECO7 Start Up 1 September 2009 20
Slide 7: Overview – structure of the mill (2009)
Overview – structure of the mill (2009*) PM 1 PM 2 PM 3 PM 4 PM 5 PM 7 145 kt 210 kt 125 kt 180 kt 210 kt 470 kt (design) 5.3 m 4.4 m 4.4 m 4.4 m 5.3 m 7.8 m Light weight Kraftliner Testliner SC fluting Light weight Testliner Kraftliner 150 – 330 g/m2 WB Fluting Kraftliner WB Fluting Sackpaper Kraft
Slide 8: Market segmentation by end-use application
Market segmentation by end-use application Henkel, Pizza Hut, Nestle, Tesco, Carrefour Lafarge, Bayer ● Cement Higher gsm ● Premixes ● Feed ● Fruits, vegetables, meat Sack Kraft paper ● Heavy duty packaging S.C. Fluting ● Chemicals KLB ● Electronics P&G, Pizza Hut, Kimberly-Clark WB Fluting Lower gs
Slide 9: Investor and Analyst site visit, Syktyvkar and Świecie
Investor and Analyst site visit, Syktyvkar and Świecie, 2 – 4 November 2010 PAGE 8
Slide 10: Strategic focus and performance
Strategic focus and performance
Slide 11: Transformation of the company
Transformation of the company Process Change Celuloza MPP Performance Świecie Świecie Goal Operational, Financial, HR, Sales, Goal Quality, Environmental, Safety Capacity Value Creation Utilization High Performance Past Now Time Investor and Analyst site visit, Syktyvkar and Świecie, 2 – 4 November
Slide 12: Mondi Diamond
Mondi Diamond Operational Excellence ● Continuous improvement approach People Development ● High assets utilization rate (efficiency) ● Individual development & ● Knowledge Management Training plans ● Waste reduction ● Talent management & ● Low working capital succession planning ● High productivity
Slide 13: Sustainable development – safety
Sustainable development – safety OTTO ZerO Tolerance Target ZerO Number of Lost Time Injuries 1997-2010 (including Contractors) 43* 37* 31* 21* 18* 9 5 3 2 2 1 1 1 1 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 * Excluding contractors Investor and Analyst site visit, Syktyvk
Slide 14: Sustainable development – environment
Sustainable development – environment Mondi’s paper products mean minimum environmental impact – All papers produced in Świecie have FSC certification Continuous reduction of CO2 emissions H2O Reduction of water and energy consumption Mondi Świecie uses over 40% of all recycled fibre collected in Po
Slide 15: Sustainable development – recognition
Sustainable development – recognition RESPECT INDEX PREMIUM BRAND / Warsaw Stock Exchange by Deloitte / / Warsaw Stock Exchange by Forbes / November 2009, Mondi Świecie S.A. was October 2009, Mondi Świecie S.A. was included “Respect Index”, reflecting the granted the title of the Highest Reputation
Slide 16: Proactive investment strategy – major capital projects 2000 - 2009
Proactive investment strategy – major capital projects 2000 - 2009 Proactive Early action against foreseen trends, developments and Investment changes in business environment (markets, customer Strategy needs, changes in operational environment). Market Development Focus Project Targets / Achievemen
Slide 17: Proactive investment strategy – major capital projects 2000 - 2009
Proactive investment strategy – major capital projects 2000 - 2009 Proactive Early action against foreseen trends, developments and Investment changes in business environment (markets, customer Strategy needs, changes in operational environment). Early Action against foreseen changes in operational
Slide 18: Operational excellence – production increase
Operational excellence – production increase Since Mondi became the majority shareholder, Świecie’s production has almost tripled 1 284 1997 Mondi becomes majority shareholder 977 824842845 797 737760 690 631 603 538 488 416 428435446 379384380386 391 381 333 346362 341318 346 307299 282 295318 251
Slide 19: Operational excellence – productivity increase
Operational excellence – productivity increase Since Mondi became the majority shareholder, Świecie’s productivity increased by more than 7 times Employees, average Total productivity in tonnes 3500 1100 3,124 902 973 3000 941 946 900 2,703 823 2500 722 652 700 587 2000 1,986 459 500 409 1500 1,473
Slide 20: Raw materials – woodpulp market Poland
Raw materials – woodpulp market Poland The challenge for the future: competitive woodpulp market Forests covers 9.3 m ha in Poland = 29.1 % of a country area Forest area [ % ] 81.8 % of forests are state owned and public; State Forest Enterprise (SFE) manage 77.8 % of all forests 32.7 m m3 of wood i
Slide 21: Raw materials – recovered paper market
Raw materials – recovered paper market recovered paper net export - packaging grades ['000 tons] Poland is a net exporter of recovered paper 500 450 400 350 300 250 200 150 100 50 0 F 06 07 08 09 10 20 20 20 20 20 Source: Association of Polish Paper-Makers Investor and Analyst site visit, Syktyvkar
Slide 22: Customer focus – exceptional customer and technical service
Customer focus – exceptional customer and technical service Optimisation of Order Lead Time via Standardisation and Make to Stock implementation Professional technical assistance for customers in corrugated board production leveraged by superior expertise offered by highly qualified and experienced
Slide 23: Cutting edge products – strength through innovation
Cutting edge products – strength through innovation PROVANTAGE FRESCO FLUTING World class quality of S/C Fluting for fruits and vegetables Strength and Runnability PROVANTAGE EXTRA LITE KRAFTLINER Lower weight = higher strength = lower cost Better Printability PROVANTAGE AQUA LINER Kraftliner grade
Slide 24: People development – fundamental activity
People development – fundamental activity Coaching for performance Mondi Leadership Model PROVIDE Target – Team – Individual CLEAR EXPECTATIONS Management by Objectives linked to bonus system (all employees) PROVIDE BUILD CONSEQUENCES OWNERSHIP Individual development plans for all employees BUILD AN
Slide 25: ECO 7 – success story
CC fast.light.central.
Slide 26: Proactive investment strategy – CEE light Mondi's strategic project 2009
Proactive investment strategy – CEE light Mondi’s strategic project 2009 Strategic Target: Strengthening of Mondi’s position in Central European market, especially in fast growing segment of lightweight recycled grades while utilizing competitive advantage given by integration with Mondi’s 5 Corruga
Slide 27: Mondi strategic project
Mondi strategic project Strategically located – Central Eastern Europe Setting new standards – Quality and Performance Less is more – Less weight – Less waste – Less cost Ready to go – Automated Warehouse: standard reels delivered within 24 hours in Poland State-of-the-art technology – Hi-Speed, Dou
Slide 28: Project rationale – why in Świecie?
Project rationale – why in Świecie ? Market Growing demand for recycled containerboard in Central and Eastern Europe Rising trade deficit in recycled containerboard in the Region Strong electronic and household goods industries in Poland Integration with Mondi’s 5 Corrugating Plants in Poland Cost c
Slide 29: Project scope & site layout
Project scope & site layout + anaerobic treatment plant New automatic warehouse + infrastructure and media with automated reel transport connections + all required modifications to the existing equipment New wastepaper storage area Inclusion to the public road New paper machine New RCF plant Source
Slide 30: Construction in numbers
Construction in numbers ECO7 Facts SHE 7 000 trained people 2.4 m manhours 1 LTI occurred Buildings Volume/Length 355 500 m³ / 320 m Reinforced Concrete 65 000 m³ Construction Steel 8 500 t Optic, MCS, Industrument installation cables 285 km Electric Cables 530 km Piping 60 km Peak Manpower on Site
Slide 31: Operational highlights ECO7
Operational highlights ECO7 1200 trucks carried the equipment to the mill. The heaviest press rolls had to be shipped. One of the largest available cranes was used to install the precast elements of the building. The crane, with lifting capacity of 450 t, arrived at the site in 36 trucks. The winter
Slide 32: ECO7 project success summary
ECO7 project success summary Successful PM 7 erection • Safety: only one LTI during constructing ( 7 000 contractors trained) • Construction completed within 17 months from earth works to the paper on the reel, ranks the project among the shortest ever achieved for new paper making lines • Capex exp