vetropack group positive results and outlook – with...

glass machinery plants & accessories 4/2015 53

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Vetropack is one of Europe’s leading manufacturers of glass

packaging for the food and beverage industry, with group

management in Bülach, Switzerland. It runs state-of-the-art production

facilities, as well as sales and distribution centres, in Switzerland, Austria,

the Czech Republic, Slovakia, Croatia and Ukraine. Vetropack offers

tailor-made glass, innovative packaging solutions, reliable product

quality and on-time deliveries.

In the 2014 reporting year, Vetropack Group further increased both its sales and its

consolidated revenue (adjusted for currency effects). All production capacity was essentially utilised and net liquidity reached an all-time high. Strategic investments in furnaces and production infrastructure have helped to improve efficiency and flexibility

and secure the future of plants.Whilst both sales and consoli-

dated revenue increased by 4.2 per cent over the 2014 financial year, negative exchange effects impacted the real result, lead-ing to a fall of 2.8 per cent in revenue.

Ukrainian JSC Vetropack Gostomel reported a strong oper-ating performance, but its contri-

Vetropack Group

POSITIVE RESULTS AND OUTLOOK – WITH INVESTMENTS IN MIND

bution to consolidated revenue was affected by the devaluation of the local currency. The Swiss Vetropack company increased its contribution to revenue to 13.7 per cent, thanks to the strength of the Swiss franc in the declin-ing domestic market.

Vetropack Austria GmbH, with its two glassworks in Pochlarn and Kremsmunster, again pro-

54 glass machinery plants & accessories 4/2015

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vided the largest share of gross revenue (31.4 per cent).

Moravia Glass a.s. in the Czech Republic remained constant and Slovakian Vetropack Nemsova s.r.o. generated 8.3 per cent, attributing this positive result to a strategic shift towards direct customer business, and reducing supplies to co-subsidiaries.

The Croatian company Vetropack Straza d.d. increased its percentage to almost 20 per cent thanks largely to the expan-sion of its export business.

POSITIVE TRENDSThe current trend towards

health-conscious consumer behaviour across Western Europe has seen an increased demand for packaging for food products, alcohol-free beverages and beer, and is creating a new opportunity for the glass packaging industry.

The only exception to this is

Production capacity and inventory reduction

Scheduled maintenance work, including replac-ing a furnace at the Czech Vetropack plant and upgrad-ing the associ-

Ukraine, which has been affected by the political and economic issues including the collapse its currency. However, there is still surplus production capacity in Europe, and so competition remains intense.

Increased salesVetropack Group increased its

sales of container glass for the food and beverage industry by 4.5 per cent, achieved purely by increas-ing export activi-ties to neigh-bouring markets. Domestic mar-kets accounted for over 56 per cent of unit sales, and export mar-kets for 43.5 per cent, with all plants operating at full capacity.

Tihomir Premužak, Johann Reiter, Inge Jost, Andriy Girnyk, Gregor Gábel, Elisabeth Boner, David Zak, Günter Lubitz, Claude R. Cornaz, Christoph Burgermeister, Marcello Montisci


Annual profit and cash flowConsolidated annual profit

amounted to CHF 49.2 million. Despite currency and interest losses, fiscal stimulus invest-ment programmes and also the sale of a property in Switzerland contributed positively to annual profit.

Cash flow (107.2 million) was down 2.9 per cent on the previ-ous year, and although annual profit was considerably lower than in the previous year, cash flow remained strong, the mar-gin being 17.8 per cent of gross revenue.

Net liquidity was more than double the previous year, and an in fact all-time high.

Balance sheet remains strongThanks to a significant increase

in liquid assets and receiva-bles, consolidated total assets remained more or less constant at CHF 792.1 million. Again due to currency effects, long-term assets fell by 2.5 per cent.

Short-term liabilities including higher accounts payable pushed debt up to CHF 159.3 million.

ated glass-blowing machines and infrastructure affected produc-tion capacity during the year.

The regenerative chambers of the furnace at the Swiss plan in St-Prex were also repaired, bringing production to a tem-porary halt, but market share was retained by strategic sales of existing stock.

Vetropack Ukraine responded to the country’s economic crisis by adjusting production and sell-ing off stock.

Across the business stock lev-els were reduced which also had a positive impact on net short-term assets.

FINANCESVetropack Group’s consoli-

dated EBIT was reduced partly by currency effects, with writing off the value of equipment, fin-ished goods and spare parts and adjusting stocks of finished goods in line with the lower level of raw material and energy costs having the greater impact. Another influ-ential factor was higher transport costs related to export.

2014 HIGHLIGHTS

Vetropack Nemsova s.r.o. had its own stand at the “Danubius Gastro” catering, food and beverage expo in -

ced by JSC Vetropack Gostomel received the Ukrainian Packaging star at “Pack Expo” in Kiev. This was followed

a few weeks later the one-litre anniversary beer bottle produced by Vetropack Nemsova s.r.o., Slovakia won a

“WorldStar” prize at “Interpack” in Dusseldorf. Other awards have included the “Slovak Gold” award (Vetropack

Nemsova s.r.o.) in the area of glass recycling. Vetropack Straza d.d. received the “Golden Key” award as a sup-

towards Croatia’s economic development. The company also received the “Platinum Key” for its outstanding

business activities.

The Vetropack plants carried out a customer satisfaction survey with the vast majority of customers declaring -

vement. Vetropack awarded the coveted Prix Vetropack during the Zurich International Wine Awards to “Villette

Chateau de Montagny Grand Cru”, a white wine from the Vins et Vignobles Les Tourelles winery in Puidoux.

JSC Vetropack Gostomel (Ukraine) took part in the annual Riga Food trade fair which attracts exhibitors from 35

countries and around 40,000 visitors. All plants were also represented on a joint stand at the BrauBeviale exhibi-

tion in Nuremberg.

renovation work. Vetropack Straza d.d has built a modern electrostatic precipitator system and a new chimney


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External debt including mort-gage loans on properties no longer required totalled CHF 31.6 mil-lion, however in operational terms, the Group remains debt-free.

Shareholders’ equity was also affected by the exchange rate, falling to CHF 632.8 million. The equity ratio remained high at 79.9 per cent of total assets.

At the end of the reporting year the Group employed 2,985 persons.

INVESTING IN THE FUTUREVetropack invested CHF 74.3

million during the reporting year. This was mainly due to mainte-nance works at the Swiss plant, carried out at the beginning of the year, including repairs to the regenerative chambers of the fur-nace, and associated works.

The flint-glass furnace at the Czech glassworks was also replaced with a more energy-efficient version and associated production infrastructure was upgraded.

This means all of Vetropack Group’s furnaces are at the latest technological standard.

Hard glass projectVetropack has been working

on a project with Bucher Emhart Glass to produce thermally tem-pered glass packaging. The next step will be to launch these into the Austrian market in conjunc-tion with a local customer.

Shares and dividendsVetropack’s share price failed

to achieve the SPI’s performance of 12.1 per cent in the report-ing year. The uncertainty caused by political and economic situa-tion in Ukraine impacted heavily on this result. Vetropack Group generates most of its revenue in European foreign currencies, but consolidates its figures in Swiss francs. Unless the monetary poli-cy situation eases, the decision to scrap the minimum exchange rate

with the euro will lead to lower consolidated results and unreal-ised book loses on the Group’s Euro-dominated holdings.

GROUP COMPANY OVERVIEWSSwitzerland

This year’s revenue was equal to last year’s, mostly due to increases in domestic sales, particularly in the beer product group.

However, the company’s strat-egy was to reduce beer bot-tle sales in foreign markets, while recycling activities were increased.

Future business will be chal-lenged by strong competition due to the price advantage gained by glass manufacturers and traders from the Eurozone. This also applies to the Swiss glassworks’ export activities.

“The various cost saving meas-ures we have taken have been nullified, and now we have to step up our efforts even more to find ways of mak-ing improvements,” said Claude R. Cornaz, CEO.

St-Prex Plant Switzerland

Pöchlarn Plant Austria

Kyjov Plant Czech Republic

Nemšová Plant Slovakia

Hum na Sutli Plant Croatia

Gostomel Plant Ukraine


Vetropack AustriaThe Austrian company once

again surpassed its high level of revenue and sales over the year. However, the trends in domestic business varied considerably, with the wine product group decreas-ing, but other segments perform-ing positively. Exports made up 42.9 per cent of total sales.

The Pochlarn plant increased its warehouse capacity, and is currently planning more storage space, while the Kremsmuster plant was also expanded.

Research results released by the Austrian Institute for Industrial Research has shown that each job at Vetropack Austria creates a total of 2.55 jobs in the country.

Vetropack Nemsova s.r.o. (Slovakia)

Revenue in Slovakia increased by 7.1 per cent on the previous year. The plant maintained its leading position in the domestic market, and continued to improve ranges and production. It also improved facilities and infrastruc-ture to help optimise production and quality during the year. The company has continued to develop distinctive and exclusive products in collaboration with clients, and the modernisation of production facilities has helped to optimise production.

Vetropack Moravia Glass a.s. (Czech Republic)

The country’s economy recov-ered during the year, and the market remained competitive, with support from new projects and breweries embracing new bottle types.

Despite a three-month halt in production due to maintenance, business continued to flourish, and the plant was utilised to capacity.

Vetropack Staza d.d (Croatia)The company’s revenue

increased by 6 per cent, with the

company selling over 1 billion units of packaging for the first time in its history. This included 34 new models developed in col-laboration with clients.

The country’s ongoing eco-nomic crisis continues to have a negative effect on purchasing in Croatia and neighbouring coun-tries, which of course has led to a decline in regional markets. Exports amounted to 7 per cent of total revenue.

VETROPACK INRETROSPECT – 2014

Increase in sales and efficiencyAccording to Cornaz, 2014

turned out better than expected, given the uncertainty over the year. The company achieved its planned sales increase, and sig-nificantly improved efficiency.

“We have been using a triple-gob machine for production at our Swiss plan in St-Prex since the start of the year, which means that three bottles per cycle can now be formed at the hot end,” he said. “We have also been mak-

“However, the Swiss plant still has many advantages over foreign manufacturers, the main two being our geographical loca-tion, and the expertise of our spe-cialists. We offer customers face-to-face advice and guidance, and can also work closely with them to design customised glass pack-aging, for example, right from the initial design idea to provid-ing filling and capping solutions.”

Muller + KrempelThe Bülach-based business

generated CHF 14.0 million dur-ing the year, 51.6 per cent of which was attributable to retail sales and over 20 per cent to packaging for the pharmaceutical and cosmetics industry.

VetroconsultThe technology, production,

purchasing and IT divisions made significant progress in the purchas-ing of capital and industrial goods across the group, thanks to a new group-wide purchasing system.

JSC Vetropack Gostomel (Ukraine)JSC Vetropack Gostomel con-

tinues to maintain sales, and is expected to continue making a positive contribution to added value, despite the uncertainty over the future of political and economic situation in Ukraine. The weakness of the local cur-rency will of course have an adverse affect on results in Swiss francs. This has of course hit the food and beverage industry hard, and reduced production. However strained relations with Russia boosted local production.

Vetropack Group is confi-dent that it will be able to fur-ther develop its export business despite these factors, although of course they will dampen the effect of the positive market trends across the Group, and lower consolidated revenue and profit figures are expected in the 2015 financial year.


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ing bottles for sparkling wine, filling a gap in supply in the Swiss market.”

The company has also replaced an old furnace, and installed two new glass-blowing machines in the Czech plant. In Ukraine it has modified a triple-gob machine enabling it to also handle double-gob processing, which has boost-ed flexibility. Smaller quantities of custom-designed bottles are in high demand among spirits pro-ducers and the multi-gob system at the Croatian plant has proved its worth.

Challenges“We are keeping our faith in

Ukraine. We keep in regular con-tact with our local management team, assess the situation, and if necessary take precautionary measures,” said Cornaz.

Sales in Ukraine are still doing well, considering the circum-stances. An increasing number of customers there are replac-ing Russian imports with local products, and there have been no stoppages caused by shortages of gas or raw materials. Of course, the challenges of this situation are not likely to go away in the near future.

“The other major challenge is that the Swiss franc is no longer pegged to the euro. Whilst our subsidiaries mainly produce and sell in foreign currencies, this will make little difference to them. However, this will have a huge impact on us because our con-solidated revenue in Swiss francs will drop, as will our earnings figures.

Innovation: the hard glass project

The project, being developed in conjunction with Bucher Emhart Glass, has made steady progress during 2014, including the ongo-ing work on process validation, risk assessment and close coop-eration with independent insti-tutes in Italy and Germany.

The project has successfully developed hard glass containers which are light-weight yet strong, and in high-demand particularly for multi-trip bottles.

It aims to launch the new glass packaging product onto a local market in collaboration with a brewery.

SUSTAINABILITYFor the first time, Vetropack

has published a sustainability report to coincide with the 2014 Annual Report. It has been ana-lysing environmental data for over 15 years, as well as infor-mation relating to occupational safety, quality etc, and according to Cornaz “much more to say on this topic than we can fit into just two pages of the Annual Report.” The sustainability report will also meet the requirements of an increasing number of customers and organisations that are ask-ing for this information from the company.

CH-8180 Bülach - Switzerland

Tel: +41 – 44 – 8633131 Fax: +41 – 44 – 8633121

www.vetropack.com

VETROPACK HOLDING LTD.

vetropack group positive results and outlook – with...

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