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Graphic Packaging eyes global growth

By Joe Whitworth , 08-Feb-2013

Graphic Packaging’s CEO and president has revealed he would like the firm “to be bigger” in Latin America but said there are no immediate acquisition plans.

The firm reported their Q4 and full year results citing acquisitions, product launches, customer wins and productivity enhancements for full year growth in sales and volumes.

David W. Scheible, chief executive officer, president and director, said there was interest in Latin America and Europe but was content with their current plan in China.

“So regionally I'd like us to be a bigger in Latin America than we currently are. And if there's good assets available down there, we're going to buy them,” he told analysts in a conference call.  

“Europe, I think we could do more in Western Europe, but I believe Eastern Europe is a better -- is a good place for us as well.”

China and SBS

He added that the plan is China was pleasing around the converting network which he described as “incredibly low-cost”.  

“It's just as easy to design the products and pull the board through than it is to sort of build on the ground converting in China.

“So I don't know that a big acquisition in Asia-Pacific makes a whole lot of sense.”

Scheible added that solid bleached sulfate (SBS) paperboard is also an area of interest.

“And so, as companies reassess their strategic goals and strategic assets, you never know when somebody might want to spit out an SBS mill and we're certainly interested in those kinds of things.”

Group performance

Paperboard Packaging sales, which comprised 83.2% of Q4 net sales, decreased 2.2% compared to Q4 2011.

The decrease reflected lower contractual pricing related to prior commodity input deflation.

Net sales in the Flexible Packaging segment increased 13.6% compared to Q4 2011. The increase was the result of the addition of Delta Natural Kraft, LLC and Mid-America Packaging, LLCbeginning on 8 December 2011.

The firm added that they expect the biomass boiler in their Macon, Georgia mill to come online late in the second quarter.

Graphic Packaging acquired Contego and A&R in November to build on its European Packaging business.

Commenting on the two acquisitions, Scheible said: “Similar to our operating model in the US, this provides us with an opportunity to further integrate our board business and expands our share of the global SUS market.

“It also expands our relationship with key global accounts such as Kellogg’s, Nestlé, General Mills, Heineken, SABMiller, AB InBev and it provides us access to other new accounts in Europe.”

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