Nampak’s 6 month turnover reaches R10 billion

Nampak, Africa’s largest packaging company today released its interim results for the six months ended 31 March 2009.

The results show revenue up 14% to just over R10 billion which was achieved mainly through the recovery of raw material cost increases and improved trading from African operations. Despite the tough economic conditions, volumes in the main market, South Africa, held steady, but were lower in Europe.

Trading income before abnormal items increased by 3% and was impacted by the late commissioning of the new paper mill at Rosslyn.

Headline earnings per share were 39% lower due to a loss on the fair value of financial instruments compared to a gain and tax provision write-back last year.

Total capital expenditure was R759 million with the major projects being the Rosslyn paper mill and the Angola beverage can factory.

Andrew Marshall who took over as CEO on 1 March 2009 said “Performance in South Africa was in line with last year. Increased trading income was offset by additional costs from the late commissioning of the Rosslyn paper mill. In Africa, trading income improved significantly due mainly to Zambia and Nigeria. European trading income was lower due to higher polymer costs as well as a poorer performance by the Leeds U.K. carton operation.

Going forward, the group expects current difficult economic conditions to continue in all the markets in which we operate. We shall therefore focus on improving or disposing of underperforming operations, the reduction of costs, management of working capital and reduction of capex.”

Nampak Flexible produces new look packaging for Willards

Nampak Flexible is producing the packaging for the new look Willards Crinkle Cut and Original Cut chips and in so doing is helping the brand communicate a quality message to consumers.

After many years of limited brand activity in the local market, Willards decided to pursue a “back to basics” approach in terms of their offer and made a general commitment to improving the quality of their Crinkle Cut and Original Cut chips.

The cut of the chips was changed to a wavy cut instead of a zigzag cut, which improved the flavour delivery and two exciting flavours were launched: Pickled Onion and Cheese & Sweet Chilli. A gold “W” appeared on all merchandise and the packaging was revamped to include cutting-edge design, a fresh colour palette and bold imagery.

The move to Nampak Flexible bags was part of the total upgrade. Willards specifically required bags that would be airtight, keeping their chips fresher for longer and delivering the brand’s promise of quality to consumers.

With this in mind, Nampak Flexible constructed a bag from high-barrier BOPP film that was laminated using extrusion-lamination technology. Warren McPhail, the key accounts manager of Nampak Flexible responsible for Willards, says that there are three main benefits of extrusion technology for potato chips. “Firstly the bags retain more air in-pack giving better shelf life, secondly they’re more difficult to crush so fewer chips are broken, and thirdly the bags have a quality feel, which is premium.”

The bags are reverse printed on a gravure press in seven colours. The film was supplied to Willards on reels for conversion purposes.

As part of the Willards re-launch, special emphasis was placed on the 30-gram bag. A robust distribution strategy ensured maximum reach and afforded consumers the opportunity to sample the product improvements in a smaller pack and at limited expense. To further improve the attractiveness of the offer, Willards ran an on-pack promotion, whereby consumers stood the chance of winning a share of airtime to the value of R1-million. The details of the promotion were included on Celomat stickers from Nampak Flexible, which were applied directly to the packs during the filling process.

This is the first time that Celomat has been used on snack packaging in South Africa. Warren says that Celomat is great for promotions because it guarantees accuracy of positioning and ensures that there is a sticker in every pack.

Nampak Flexible sourced the Celomat stickers from their gravure printer partner in Argentina. Although they were applied at Willards, Nampak Flexible supplied the applicator machines, led the installations, provided technical support and trained the machine operators.

The category marketing manager of Willards, Julia Dawson, says that the bag and promotion have been “very successful” for the brand.

Nampak Flexible has a multi-year supply agreement with Willards. The Pinetown plant is the primary manufacturing hub.