Highest capex level ever

Over the past year, Fibertex Personal Care has implemented its most comprehensive investment programme ever. The company made investments for no less than DKK 650 million in 2016 directed at expanding capacity, improving quality and optimising its environmental profile and energy consumption. The moves consolidate the company’s position as a frontrunner in terms of quality, service and corporate responsibility. Last year, those qualities earned Fibertex Personal Care a Procter & Gamble award that is considered the highest honour in the industry.

 

As the world’s fifth-largest manufacturer of nonwoven textiles, Fibertex Personal Care produces about 10% of global output. The company consolidated its position in 2016 by launching investments worth over half a billion Danish kroner.

The largest single investment was DKK 400 million to build a whole new factory in Malaysia to house the company’s eighth production line. Fibertex Personal Care currently has three production lines in Aalborg, Denmark, and four in Nilai, Malaysia. As there are no more expansion options at the existing site in Malaysia, Fibertex Personal Care is constructing a new factory about 25 km from the current facility. Construction is already well underway, and the factory will be fully operational in the second half of 2017. At a capacity of almost 20,000 tonnes, the new line will lift the group total annual output to 138,000 tonnes, and give a capacity increase of 20% in the rapidly growing Asian market.

All-important softness

Fibertex Personal Care has also made a capex investment in upgrading its Aalborg factory, with its DKK 100 million project to facilitate production of new, soft and textile-like products. Fibertex Personal Care’s non-woven textiles are the main components in diapers, femcare and incontinence products. Consumer demand in both Europe and Asia is on the rise for products with a more cotton-like feel, and this is where Fibertex Personal Care has some very special capabilities. For decades, the company has researched how to enhance softness and the fine feel of its products and consistently implemented its latest innovations in its factories in Nilai and Aalborg. 

Print holding great potential

Fibertex Personal Care also invested heavily in its print operations in 2016. Innowo Print, the printing business based in Ilsenburg, Germany, that Fibertex Personal Care co-founded in 2008 and which it took full ownership of in 2014, employs about 100 people today. DKK 50 million was spent in 2016 on adding a fourth printing line in Germany, while another DKK 50 million has been allocated to establishing a first printing line in Malaysia. The latter project is especially interesting because it involves a unique technology that allows direct printing on nonwoven fabrics. This makes Fibertex Personal Care the first manufacturer in Asia capable of printing, for example, teddy bear motifs directly on the external layer of a diaper.

Consumption of virgin polypropylene cut by 20%

Fibertex Personal Care also invested in recycling and in optimising its energy consumption in 2016. More than 97% of waste from production in Nilai and Aalborg is reprocessed and reused.

As a result, the company’s use of virgin poly-propylene, i.e. the raw material produced in the crude oil fractionation process, has been cut by 20% over the past few years. This is good for the environment, and it makes good economic sense, which is characteristic of the many environmental footprint- and energy-reducing projects launched by Fibertex Personal Care. 

Extensive agreement with the Danish Energy Agency

Fibertex Personal Care’s production process is relatively energy-intensive. Electric power accounts for 80% of the energy consumed, but this is also an area in which improvements are consistently made for the benefit of both the environment and the company’s bottom line. In 2016, Fibertex Personal Care signed an extensive agreement on energy efficiency enhancements with the Danish Energy Agency involving a three-year mutually binding subsidy scheme that will reduce the company’s PSO charge in return for Fibertex Personal Care launching a number of projects aimed at optimising its energy consumption. As part of the agreement, the factories at Aalborg and Ilsenburg have been certified to the ISO 50001 energy management standard. This is expected to result in energy savings of 1,500 MWh per year at the Aalborg facility alone, or the same amount that 250 households consume annually, once all the projects have been finalised.

CR, quality and service creating new opportunities

Initiatives involving corporate responsibility (CR), quality and service have become a trademark of Fibertex Personal Care and are highly valued by the company’s customers, which include some of the world’s largest companies, such as Procter & Gamble (P&G), Kimberly Clark, SCA and Ontex. Most recently, Fibertex Personal Care won Procter & Gamble’s External Business Partner of the Year Award. CEO Mikael Staal attended the ceremony at P&G’s US headquarters in Cincinnati, Ohio, to receive the award in person. P&G is the world’s leading consumer goods manufacturer, and this biennial award is granted to only a very few selected among P&G’s some 50,000 suppliers worldwide. It is very likely one of the highest awards in the consumer goods industry anywhere.

In fact, Fibertex Personal Care’s approach to CR, quality and service is a veritable gateway to new opportunities, and that is why the company has a steady need to expand capacity with the support of Schouw & Co., which also helps improve both its top and bottom lines. Having a reputation as one of the best in the industry and products that consistently raise the bar for softness and other characteristics translates into good sales opportunities.

The Asian markets still have the highest growth rates in the personal care industry. The annual growth rate of roughly 10% is driven by the increasing focus on hygiene by the middle class in these countries. Sales of Japanese luxury hygiene products are growing rapidly in large parts of Asia, and, for many Japanese manufacturers, Fibertex Personal Care is the preferred non-Japanese supplier.

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