ANNUAL REPORT 2016 - Sequana · 2017. 6. 15. · with Antalis, and a manufacturer of recycled and...
Transcript of ANNUAL REPORT 2016 - Sequana · 2017. 6. 15. · with Antalis, and a manufacturer of recycled and...
ANNUAL REPORT 2016
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02SEQUANA AROUND THE WORLD
04 Profile
05 Interview of Pascal Lebard
08 Corporate strategy
10ANTALIS OVERVIEW OF AN INNOVATIVE DISTRIBUTOR
12 A trip around the world of innovation
16 Forward outlook – Strategy
18 Our customers’ planet
20ARJOWIGGINSLOGBOOK OF A PRODUCER ON THE MOVE
22 A trip around the world of innovation
26 Forward outlook – Strategy
28 Our customers’ planet
30A RESPONSIBLE JOURNEY
32 CSR, on the road to 2O20
34 Destination: Staff & Safety
36 Human resources indicators
38 At the heart of traceability
40 Environmental indicators
42 Responsible consumption
44 Community engagement
46SHAREHOLDER’S GUIDE
48 Governance
50 Sequana Group results
54 Stock market
Presence in over
45 countries
8,500employees
€3 billion in sales
both a distributor of papers, packaging products and visual communication materials with Antalis, and a manufacturer of recycled and specialty papers with Arjowiggins.
Antalis currently generates over three quarters of the Group’s sales. Further to the IPO, Sequana will remain its majority shareholder.
For many years now, Sequana has consolidated the positions of Antalis in the paper distribution market — where it is number 1 in Europe and number 1 worldwide (excluding the US) — and has boosted its growth pace in the Packaging and Visual Communication sectors where the Group
is a leading player. Concurrently, the Group is refocusing the production activities of Arjowiggins on the recycled and specialty paper markets where it enjoys solid positions.
Sequana operates in over 45 countries, serving a professional clientele of corporates and printers. The Group generated sales of €3 billion in 2016, with a staff of around 8,500 employees worldwide.
Positioned at the crossroads of sensitive issues like global warming or the preservation of natural resources, Sequana’s expansion strategy focuses on a sustainable improvement process.
Sequana is
Sequana • Annual Report 2016 • 1
SEQUANA AROUND THE WORLDBoth a distributor of papers, packaging products and visual communication materials, and a producer of specialty papers, Sequana pursues its transformation. We embark on a journey at the heart of a Group whose priority is to provide its customers with ever-more efficient products and services.
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Sequana • Annual Report 2016 • 3
PAPERS Coated and uncoated papers
• Specialty and creative papers
• Envelopes
• Graphic supplies
•Office papers
71%
•Flexible or rigid media
& materials, paper/board or plastics-based
VISUAL COMMUNICATION
9%
• Consumables
•Machines
•Customized packaging solutions
PACKAGING20%
GRAPHIC •
Recycled papers, eco-friendly coated & uncoated papers
• Recycled pulp
• Papers for specialty applications
52%
CREATIVE PAPERS
• Premium fine papers
• Papers for specialty applications
• Papers for payment media and secured documents
30%
SECURITY•
Banknote paper
18%
PROFILE
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What is your view on the Group’s results in FY 2016? Apart from the Security Division, our operating performance was encouraging. Proforma EBITDA reached €105 million, stable year-on-year versus 2015. Despite a sharply declining market, Antalis has proved resilient, with an EBITDA of €88 million, equivalent to 2015 at constant exchange rates. As for Arjowiggins, its operating performance improved significantly with a 14% growth of its proforma EBITDA at €28 million, a satisfactory performance given the sharp deterioration of the Security Division burdening its results (EBITDA dropped from +€10 million in 2015 down to -€13 million in 2016). Excluding the Security Division, Arjowiggins posted a proforma EBITDA of €41 million, versus €15 million in 2015. This significant improvement reflects the successful restructuring plan of Graphic and Creative Papers, which has enabled a clear turnaround of these divisions. The Group’s net debt reaches €315 million, up €80 million due to cash outflows of €93 million for exceptional items, partially offset by €25 million in proceeds from asset disposals. The net debt/EBITDA leverage ratio stands at 2.9x, better than expected.
How do you explain the net loss attributable to owners?We booked €72 million in net non-recurring expenses linked primarily to restructuring costs of €26 million mainly at Antalis in 2016. Other contributors to the loss included asset impairments in the Security Division for the most part (€18 million), legal expenses linked to the litigation with BAT (€14 million), and operating losses of €10 million due to a quality-related legal dispute in the Security Division. After deducting net finance costs and taxes, the net loss attributable to owners was €52 million, compared with a net loss of €67 million in 2015. In this context, the Board of Directors decided to recommend not paying any dividend for fiscal year 2016 at the next Annual Shareholders General Meeting.
In early February 2017, the High Court of Justice ruled against you in the legal dispute with British American Tobacco (BAT). On what grounds did the Court base its ruling?As a reminder, the dispute relates to two dividends paid to Sequana in 2008 and 2009 in settlement of a current account by its former subsidiary Windward Prospects Ltd prior to its disposal. In its first ruling of 11 July 2016, the High Court of Justice of London rejected all of BAT’s claims based on the Companies Act 2006. Conversely, the Court accepted BAT’s claim on the second dividend, considering that it fell within the scope of section 423 of the Insolvency Act 1986.
SEQUANA AROUND THE WORLD
“Floating Antalis on the stock market is a way to associate
our shareholders in the growth of our
subsidiary.”
Interview ofPascal LebardChairman & Chief Executive Officer of Sequana, Chairman of Antalis and Arjowiggins
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Pascal Lebard 54 years old, Chairman & Chief Executive Officer of Sequana,Chairman of Antalis and Arjowiggins
Hervé Poncin53 years old,Senior Executive Vice-President of Sequana, Chief Operating Officer of Antalis
Antoine Courteault60 years old,Corporate Secretary
Xavier Roy-Contancin 58 years old,Group Chief Financial Officer
EXECUTIVE COMMITTEE
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The Court had however not ruled on the amount of damages, pending subsequent hearings. These hearings were held in January and February 2017. On 10 February, the Court ordered Sequana to pay to BAT a sum of $138.4 million as principal, to be capped at the amount of the dividend (€135 million) plus interests of €17 million. The Court also granted a stay of execution pending the decision of the Court of Appeal that should occur in 12 to 18 months. Sequana was also ordered to pay part of BAT’s legal costs (approximately €11 million). We lodged an appeal on 31 March 2017 against the substance of the decision made against Sequana.
Why did you not book any provisions for the BAT litigation in your accounts closed at 31 December 2016?Firstly, we consider that the decision made by the High Court of Justice in July 2016 is in our favour, namely the Court’s rejection of BAT’s claims under the Companies Act in its first judgement is still subject to the same degree of legal uncertainty pending the decision of the Court of Appeal (which is unlikely to be issued before 2018).And most of all, we have taken legal advice and we still consider that we have solid legal arguments to raise on appeal, particularly on the application of section 423 of the Insolvency Act to the second dividend.
After the disposal of Arjowiggins Healthcare, you are now selling part of the Banknote business of the Security Division. Is this a prelude to other disposals within Arjowiggins?The sale of Arjowiggins Healthcare to Meeschaert Private Equity, in partnership with the company’s executive management team, has already enabled Arjowiggins to bolster its financing capacity to restructure the Creative Papers and Graphic Divisions. As for the disposal of Arjowiggins Security BV and its VHP mill to Oberthur Fiduciaire, it provides a solution to the major challenges encountered by the Security Division over the past two years. Overcapacities in the banknote paper market, along with sharp pressure on selling prices have resulted in a significant deterioration of the Division’s operating performance. Proceeds from this disposal will enable us to initiate a turnaround of the French Banknote business, in the event that the recently launched disposal process were to be unsuccessful. These measures, combined with the Antalis IPO, if approved by the Group’s shareholders, should enable us to quickly exit the preventive procedure (procédure de sauvegarde) which we entered on 15 February.
Regarding Antalis, what is the rationale for the IPO? Together with the Board of Directors, we have decided to distribute approximately 18% of the share capital of Antalis International to our shareholders. All current shareholders will receive 1 Antalis International share for every 5 Sequana shares held. Opting for this distribution approach instead of going to the market enables Antalis International shares to be traded on Euronext Paris, whilst avoiding the market risks otherwise inherent to such operations. Floating Antalis on the stock market is a way to associate our shareholders in the growth and success of our subsidiary.
What will be the shareholding structure of Antalis once it is listed?Sequana will remain the majority shareholder of Antalis. Bpifrance Participations and Impala Group will also become shareholders. But in the long run, Antalis is expected to be an independent company.
SEQUANA AROUND THE WORLD
Sequana • Annual Report 2016 • 7
Comforting the leadership of Antalis in its markets With the planned IPO of Antalis, Sequana intends to secure its growth and strategic expansion in the promising sectors of Packaging and Visual Communication, and to consolidate its leadership in paper distribution. In this sector, the acquisition of Map in 2007 has enabled Antalis to become the European leader, a leadership further comforted by the 2013 acquisition of Xerox’s office paper distribution business in Western Europe. This strategy is crucial to retain a positive scale effect, implement synergies, particularly to cut costs, and continue growing the Group’s businesses in packaging and visual communication.
These growing, but still highly fragmented markets provide major consolidation opportunities for Antalis. For several years now, Antalis has been pursuing an active acquisition policy designed to transform its product mix as well as the Group’s profile, thereby enabling Antalis to become the European leader in packaging products distribution and a major player in the distribution of visual communication materials. This transformation strategy has proven fruitful, and these businesses contributed 33% to the Group’s gross margin in 2016 versus 14% in 2010.
Focusing Arjowiggins on recycled and specialty papersIn order to focus the Arjowiggins Divisions on high value-added markets and to respond to the steady decline of printing paper volumes, the Group implemented in 2014 a major restructuring plan with a dual goal: discontinue its loss-making businesses, and optimise its fine paper manufacturing capacities. This plan has led to a definitive exit from the standard coated market in the US and to a significant reduction of the Group’s exposure to this market segment in Europe, along with a consolidation of fine paper production at a single site. The Graphic and Creative Papers Divisions are now enjoying a sharp turnaround of their operating performance. In the banknote paper sector, due to over-capacities in the market and high pressures on selling prices – leading to a sharp deterioration in the operating performance of the Security Division – Arjowiggins will sell Arjowiggins Security BV in the Netherlands and has launched a disposal process for the banknote business in France.
In parallel, the Group has continued to evaluate asset arbitrage opportunities: Arjo Wiggins Ltda (banknote business in Brazil), Arjo Systems and Arjo Solutions (Security Solutions) were sold in 2015, and lastly Arjowiggins Healthcare (papers for the healthcare sector) in 2016.
CORPORATE STRATEGYThe priority for Sequana is to contribute to the market consolidation in the distribution of papers, packaging products and visual communication materials with Antalis, and to capitalise on specialty activities with Arjowiggins. In parallel, the Group has mainstreamed a responsible approach into its strategy.
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Generating profitable growthOne of the Group’s primary goals is to steadily improve its operating performance while generating optimal cash flows and deleveraging its debt. The main drivers available to Antalis and Arjowiggins to this purpose include strict control over fixed costs, reducing the working capital requirements, and protecting their margins via a stringent policy of customer risk management and selling prices.
The Group places innovation and value-added at the heart of its sales organisation in order to gain profitable market shares. Antalis constantly scrutinises the market in order to adapt its product and service lines to support its customers and anticipate their expectations. In visual communication for instance, Antalis has incorporated a line of customisable wallpapers into its portfolio in response to growing needs for personalised interior decoration. In services – a source of added value and additional revenue – Antalis innovates on an ongoing basis to deliver to its customers the services best suited to their business challenges, and this is the case in particular in logistics.
As for Arjowiggins, the Division endeavours to bolster the power of its brands, to make a difference and to gain its customers’ loyalty for the long term via an innovative and high value-added offering.
New products are thus regularly introduced on the market, such as the digital creative papers range, the Graphic Division’s line of premium graphic boards, or the VisionTM watermark developed by the Security Division.
Mainstreaming a responsible growth approach into the Group’s strategyThrough its distribution and production business activities, the Group is positioned at the crossroads of sensitive issues like global warming or the preservation of natural resources, Sequana acts as a responsible player towards its employees and stakeholders, and develops sustainable modes of production, distribution and consumption. The Group’s environmental commitments are reflected into tangible targets intended to improve energy efficiency, reinforce its control over the supply chain and its suppliers, and lastly to offer eco-responsible papers and solutions responding to current challenges. All initiatives are conducted by placing personnel training, occupational safety and business ethics at the core of the Group’s priorities.
Since 2012, Sequana, Antalis and Arjowiggins have been members of the UN Global Compact, attesting to the Group’s commitment to the 10 fundamental principles, and contribute to 6 out of the 17 sustainability goals of the Global Compact.
Sequana • Annual Report 2016 • 9
ANTALIS OVERVIEW OF AN INNOVATIVE DISTRIBUTOR
In 2016, Antalis consolidated its market positions in paper distribution and pursued its expansion in the buoyant sectors of Packaging and Visual Communication. A step-by-step look at the Antalis world…
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ANTALIS OVERVIEW OF AN INNOVATIVE DISTRIBUTOR
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Antalis writes a new page in FinlandAntalis selected the cities of Helsinki, Tampere and Turku to introduce the Book of 12 (BO12) to the Finnish community of printers and designers, the latest initiative developed under the Antalis Creative Power programme. The Book of 12 is a compendium of 12 notebooks compiling testimonials by 12 leading graphic designers from 12 countries.
Their conclusion is unanimous: paper delivers an unequalled dimension to successful communications for any advertiser. In the words of Elaine Ramos, a graphic designer and art director at the main publishing house in Brazil dedicated to visual arts: “I think of the texture of the paper as an essential piece of information to share a message, an idea, a concept or an impression with readers.”
spreads from London to Berlin After stopovers in London, Copenhagen, Rotterdam and Paris, the European tour of Coala® Wall Design, the Antalis range of customizable wallpapers, ended in Berlin at the Architect@work fair.
During this trade fair dedicated to architects and interior designers, Antalis connected with nearly 600 architects, the key prescribers on the home decoration market.
THE APPEAL OF COALA® WALL DESIGN
GERMANY
BOOK OF 12 (BO12)
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DENMARK
Gourmet packaging for Brød OG KagerCompetition is fierce from supermarkets selling bake-off products in the bakery and pastry sector. In an effort to stand apart from its competitors with a premium market positioning, the Danish bakery Brød OG Kager asked Antalis to supply a range of private label packaging materials for its breads, cakes and coffee. A comprehensive line of boxes, bags and cups with a powerful visual identity was designed in partnership with a communication agency. The turnkey solution delivered even includes a printer to customize the labels according to the seasonal commercial operations, along with storage of the bakery’s packaging materials at the Antalis warehouse. An innovative bespoke solution that enables Brød OG Kager to make a difference!
FRANCE
Papers and new printing technologies: a promising encounter in Paris In partnership with Xerox, Antalis organised a special event in Paris in the context of its d2b (digital-to-business) programme to help its customers discover the creative potential of digital printing. Both communication agencies and designers had the opportunity to meet in the new Brainstore, a showroom unique in Europe. The Brainstore, a genuine showcase of new printing technologies where 800 SKUs of papers and visual communication materials are on exhibit, was an ideal forum for Antalis and Xerox experts to demonstrate the numerous options provided by digital printing solutions, via in particular printing tests on the iGen5, Xerox’s latest generation digital printer.
In the Brainstore Lab, another service available at the showroom, the visitors were also able to test various finishes and to print mock-ups in multiple formats. With this showroom, Antalis demonstrates how paper can be a complementary feature of the latest printing and communication technologies.
IRELAND
Confirmed leadership in Ireland In late 2016, Antalis pursued its consolidation strategy on its historical market with the acquisition of the paper distribution business of Swan Paper (circa €13 M in sales) in Ireland. The Group thus consolidated its leadership in a high-growth country where it already generates sales of €34 million.
FRANCE
Turnkey ID cards for Parisians Antalis worked closely with the Paris municipality to deliver a turnkey solution for its “Citizen ID Card”. The Citizen Card provides opportunities to participate in the city’s municipal life and cultural activities. The card is printed on a Xerox coated polyester material with a holographic security foil on which the logo of Paris City Hall is imprinted to prevent counterfeiting. The Paris municipal authorities also wanted to send a personalised letter incorporating the ID card to all citizens who had requested it on its website. Antalis supplied a paper suitable for digitally printing the personal data of each card holder (name, address, photo) on both the cover letter and the ID card.
CHILE
Coala® on a roll in Chile Coala®, Antalis's own label of large-format printing (LFP) materials, has enjoyed great success since its introduction in 2012. The Coala® LFP range, already marketed in 26 countries in Europe, Latin America and South Africa, is particularly well suited to indoor and outdoor advertising and decoration.
In Chile, the sales teams of Banco Itaú have thus chosen Coala Walk & Wall as a decor wallpaper for the complete renovation of the bank's branches.
13 • Sequana • Annual Report 2016
PERU
Antalis consolidates durably its footprint in Latin AmericaAntalis continues to expand in high-growth markets and geographies, backed by the acquisition of TFM Industrial in Peru in late 2016, a specialist distributor of coding solutions and technical packaging to the agri-food, pharmaceutical and building industries. TFM Industrial reported annual sales of around €5 million.
This acquisition bolsters Antalis's footprint in Latin America where the Group already generates sales of nearly €18 million in this business in Chile, Bolivia and Peru.
CHILE
Training and printing material distribution: an all-in-one offer in Latin America As of 2016, Antalis is the single training centre accredited in Chile for Adobe graphic design software. It is also the only authorized trainer in Latin America for the Caldera software used for large-format printers in visual communication.
Within one year, over 320 people have been trained among the community of designers and communication agencies. This expertise enables Antalis both to market these software licences and to help professionals discover the broad scope of its paper and large-format printing material ranges, along with its large-format digital printers.
ANTALIS IN CHILE, BOLIVIA AND PERU 2016 Packaging sales
€18 M Sequana • Annual Report 2016 • 14
BENELUX
Clever packaging with CleverPack Easily recognizable on display shelves thanks to its logo and packaging system, CleverPack is the latest range of packaging products designed for Antalis’s resellers (office supplies dealers, specialist stores and DIY chains). The CleverPack, introduced in Benelux in early 2017, contains different products packed in small quantities for protection and shipping, including file binders, scotch tape or rubber bands. With CleverPack, Antalis provides its resellers with a high value-added
proposition able to respond to the booming market demand linked to the growth of e-commerce.
CZECH REPUBLIC
Antalis packs up electronics Antalis, backed by its expertise and its comprehensive offer ranging from standard products to tailor-made solutions, recently convinced a leading Czech electronics manufacturer to re-engineer its packing line. The turnkey solution designed and installed by Antalis – 8 air cushioning machines and 6 bins – enabled the customer to improve both the ergonomics of its packing stations and the employees’ productivity.
GERMANY
Hard disks under high protection in Germany One of the global leaders in the distribution of IT components was able to reduce its storage and freight costs thanks to a corrugated board packaging system designed by Antalis to fit three different sizes of hard disks. As an added benefit, the packaging is recyclable.
NETHERLANDS
Success of Antalis Premium Club The Antalis Premium Club, intended for the Group’s office paper resellers in Europe, has been attracting members in ever-growing numbers since its creation a year ago, with over one hundred new members signed up in 2016. The Premium Club provides exclusive benefits (e-mailing platform, A4&more loyalty club, promotional offers, etc.) focused on the renowned Image®, Xerox® and Data Copy® brands in the office paper sector.
In order to help its customers leverage the power of these brands, Antalis launched in early 2017 a new range of POS advertising materials (stickers, floor and shop-window adhesives, etc.) that was greeted with immediate success. According to Edwin van Lint, owner of All Office Van Lint Woerden in the Netherlands: “The Premium Club is a major asset to grow my business. Antalis gives me real support, like with this new POS advertising material that enables me to showcase the product lines that my customers appreciate.”
NORWAY
Visual Communication takes the lead Further to the acquisition of Gregersen in late 2016 (sales of circa €6 million), Antalis has become the leader of visual communication distribution in Norway.
GERMANY
Anti-corrosion solution for spare parts Claas, a German agricultural machinery manufacturer with sales of €3.4 billion, relied on Antalis to find an efficient anti-corrosion solution for the spare parts delivered by their suppliers. The wire-box pallets used for transport and storage are now fitted with gusseted bags and layer separators, both treated with a corrosion inhibitor. Thanks to its international footprint, Antalis can deliver this solution directly to Claas’s suppliers across Europe and give them instructions for use in their local language.
Sequana • Annual Report 2016 • 15
Antalis is currently the leader in paper distribution, your main business sector. What were the different steps in your expansion?We are number 1 in Europe with an 18% market share, and we operate in 28 countries. Antalis is also the only global player with a footprint in Latin America, South Africa and Asia-Pacific. Apart from the US where we are not present, our Group is therefore the global leader. These market positions result from major strategic decisions. In 2007, we took a decisive step by acquiring Map — with operations in 13 countries and sales of €1.4 billion — thereby becoming de facto the leading paper distributor in Europe. Then in 2013, we acquired Xerox’s office paper distribution business in Western Europe, accounting for sales of around €300 million, which enabled us to reach a critical size on this market. Today, we are continuing to consolidate our positions, as we recently did in Ireland.
The printing paper market is structurally on a downtrend. What is your strategy in response to this context?We are transforming the Group’s profile by diversifying our activities in the distribution of Packaging products and Visual Communication materials, two growing and promising segments that generate higher gross margins. In these highly-fragmented markets, we are the leader in Europe with a market share of around 8% in Packaging. We are also among the top 3 in Visual Communication with an
Interview Hervé Poncin
COO of Antalis
FORWARD OUTLOOKWith Antalis, Sequana consolidates its market positions in paper distribution — where it is number 1 in Europe and number 1 worldwide (apart from the US) — and accelerates its expansion in the Packaging and Visual Communication sectors.Zoom on the Group’s strategy with Hervé Poncin, Chief Operating Officer of Antalis.
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8% market share. Our growth potential is therefore quite significant, and we are pursuing the targeted acquisition strategy rolled out over the past few years. Today, these businesses contribute 33% to the Group’s gross margin, versus 14% in 2010.
How do you differentiate yourself in these markets?Our business relies on a dual expertise in sales & marketing and in logistics. Backed by our sales organisation, with dedicated teams per business sectors and structured according to the customers’ profile, we have the ability to establish strong commercial relationships. The efficiency of our IT systems, particularly in CRM1, also enables us to be highly responsive, to deliver to our customers the most suitable solutions and high value-added services. But even this sales organisation would not be enough if we could not deliver our products quickly. And that is precisely what we do with our D+1 deliveries, or even same-day deliveries in some regions. We also offer various services like delivering our customers’ printed documents to their own customers. Whether for logistical or consulting purposes, services (over 70 in some countries!) are one area where we sharply differentiate ourselves.
e-commerce plays a major role in your strategy. What are your goals?On-line sales are essential for any distributor because you give your customers the possibility of placing their orders whenever they want, seven days a week. But that’s not all! They can for instance receive advice, or access their order history, the products catalogue and their personalised pricing list. Our web site is extremely successful, with steadily growing flows of orders placed on line. We currently generate over €200 million in online sales and we intend to double this number by 2020.
What will the planned IPO mean for Antalis?This is a major step in the history of our Group, and a major boost for the visibility of its corporate identity. This transaction will help us to continue consolidating our leadership in paper distribution and will support our strategic expansion in Packaging and Visual Communication.
(1) CRM: Customer Relationship Management
In order to deliver to its customers the solutions that respond best to their challenges, Antalis has developed three key initiatives. Antalis Green Connection raises their awareness on the responsible use of recycled paper by awarding stars to papers based on their environmental performance. The d2b (Digital-to-Business) programme helps customers seize the growth opportunities offered by digital printing. And last but not least, Antalis Creative Power highlights the power and value of paper in corporate communications.
ANTALIS – OVERVIEW OF AN INNOVATIVE DISTRIBUTOR
“The IPO of Antalis is a major step in the history of our Group, and a major boost for the visibility of its corporate identity.”
Sequana • Annual Report 2016 • 17
You are one of the French leaders in large-format digital printing. What are your markets? Historically, our company has developed a screen-printing, and later digital printing activity for specialist retail chains in various sectors (apparel, sports, automobile, perfumery, etc.). Point-of-Sale communication is essential for our customers, which is why signage and decoration materials in parking lots, on shop windows and in stores are key success factors for any advertising campaign. Because these marketing events have become shorter but more numerous, they require us to be extremely agile without compromising on quality. We are currently one of the leaders in this market. Our ambition is to grow our business in the POS1 display market (totems, free-standing displays, welcome counters, etc.) where we are still a small-size player.
How did digital technologies change your business?In these times of people wanting “everything right now” pushed by the Internet, our business has become a race against the clock. Digital printing can respond to the demand in terms of speed as well as high definition and quality. It also enables us to customize the products and to print short runs. For instance, for major retailers with stores in international markets, we can print 500 copies for France and short runs of 10 to 20 copies in the local languages of each country.
Do you think that POS communication still has a bright future going forward?Absolutely! In times of challenging economic environment, advertising spend in the printed press and on TV is one of the first cost-cutting measures. Advertisers however need to continue generating footfall in their stores and stimulating purchases, which is what POS advertising can do at a lower cost. Furthermore, and far from competing against the traditional media, digital communication via flat display screens or interactive in-store terminals responds to other requirements, in particular the need for more in-depth consumer information. In short, POS advertising and digital communication live side by side and are complementary.
What is the contribution of Antalis for you on this demanding market?In our business, we use numerous types of materials – for instance board or plastics – and various formats. Speedy responsiveness is a must to satisfy our customers. Antalis gives us the flexibility and technical advice that we need. Not only is Antalis the only supplier with such a broad and innovative product range, but they can also deliver our orders on the next day. This is a key asset for our company.
(1) POS: Point-of-Sale.
OUR CUSTOMERS’ PLANETWith the advent of new technologies, companies are evolving, businesses are changing, needs are morphing. Our focus is on listening to our customers so that we can deliver solutions enabling them to be constantly up to date. Testimonials.
Interview with Arnaud LotigieExecutive Partner of Créavi - France
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You are one of the UK leaders in digital photo & photo gift printing as well as general digital commercial print. Why did you opt for this technology? Our business has changed greatly over the past two decades, switching from mail-order, analogue photo finishing to online digital printing. We currently work for both corporate customers and the consumer market for whom we produce cut prints and photo gifts including calendars, albums and cards. Our typical gift order is for one single unit, and we therefore produce millions of unique items every year. Digital printing is the only technology that is suitable for such short runs. We are equipped with nine HP Indigo presses capable of producing both these short-run gift products as well as corporate business brochures, stationery and marketing materials.
How does Antalis help you to be more efficient in your business?Antalis is a key strategic supply partner for Harrier LLC and we have been working together for many years. Firstly, Antalis is our primary supplier of coated and uncoated papers and boards. In addition, because we need to meet tight SLA requirements, it is imperative for us never to run out of high-quality raw materials. And Antalis has consistently exceeded our expectations in this respect by ensuring reliable daily deliveries. Last but not least, Antalis also helps us improve and enrich our product offering by keeping us constantly updated on the latest materials that are available, and therefore enables us to stay at the cutting edge of innovation.
Why did you decide to improve your packing chain? Fricke is one of the leading European distributors of spare parts and equipment for the agro-industry. The parts we deliver are installed on tractors, harvesters or trucks, and may include highly fragile glass panes or more resistant metal parts. Any order placed before 6.00 pm is delivered on the next day before noon. Every day, we can deliver up to 30,000 shipments across Europe. Before Antalis, 75% of our products were shipped in board boxes packed with paper inserts, air cushions or bubble wrap. We wanted to improve the packaging reliability at all 64 packing stations in our logistical centre, and to increase the productivity of the packers who are paid by piecework.
What was the solution offered by Antalis, and what are its benefits?Antalis has developed an integrated solution designed to optimise our packing equipment, while providing premium protection quality for the products. The system implemented automatically supplies two packing stations with high-strength crumpled kraft paper, with the added benefit of using less materials. The number of insert paper pallets was thus cut by one third, from 450 to 300, i.e. an annual saving of 15% on our paper costs. We were also able to significantly reduce our carbon footprint. A further benefit for our workers is the improved ergonomics of our packing stations, thus helping them to work faster and more efficiently.
ANTALIS – OVERVIEW OF AN INNOVATIVE DISTRIBUTOR
OUR CUSTOMERS’ PLANET Questions to
Julian MarshBusiness Consultant at Harrier LLC - United Kingdom
Questions toKai FührlingLogistics Manager at Fricke – Germany
Sequana • Annual Report 2016 • 19
ARJOWIGGINS LOGBOOK OF A PRODUCER ON THE MOVE
Arjowiggins focuses its business activities on the markets of recycled and specialty papers where it enjoys solid positions. Discovery of a world of innovations and creativity, by the side of a world-class papermaker.
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Sequana • Annual Report 2016 • 21
The new digital range of Arjowiggins Creative Papers, introduced in the second half of 2016, was presented in partnership with Antalis to designers and printers invited at the Hewlett Packard (HP) Graphics Experience Centre in Barcelona in late January.
The agenda of this full-day event included presentations of products and workshops about the technical requirements linked to digital printing. Printing tests demonstrated the excellent printability of the Digital Liquid Toner range on HP Indigo printers, resulting from the perfect ink adherence, immediate drying and optimal image rendering delivered by the i-Tone® technology developed by Arjowiggins in the context of its strategic alliance with the US group Mohawk.
The Arjowiggins Digital Dry and Liquid Toner range encompasses the flagship collections – Conqueror, Curious Collection, Rives, Pop’Set and Keaykolour – along with the Mohawk Superfine i-Tone® range produced by Arjowiggins at its Stoneywood mill in the UK. It also includes a broad selection of paper grades, textures, weights and formats ideal to leverage the opportunities offered by digital printing, particularly for luxury packaging.
In order to showcase its portfolio, Arjowiggins has designed a unique tool in the form of a book compiling papers for liquid and dry toner printers, along with printed samples highlighting the latest digital printing techniques like white ink or fluorescent, transparent and dimensional inks.
SPAIN NEW DIGITAL RANGE OF ARJOWIGGINS CREATIVE PAPERS ON EXHIBIT IN BARCELONA
A T
RIP
AR
OU
ND
TH
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OR
LD
OF
20
16 IN
NO
VA
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22 • Sequana • Annual Report 2016
INDIA
India catching up with creative papers In 2016, Arjowiggins Creative Papers partnered with a new distributor in India, Sona Papers who now markets the Conqueror, Rives and Curious Collection ranges in the country. This partnership was officialised in early 2017 at a special event in New Delhi gathering approximately four hundred printers, designers and advertisers.
BRAZIL
Creative papers show off their range in BrazilAs a sponsor of the second edition of What Design Can Do in São Paulo, a conference to promote design as a vector of social change, Arjowiggins Creative Papers organised jointly with Antalis two workshops focused on letterpress printing (a relief printing technique) and screen-printing. The two-days festival attracted over 1,600 visitors, primarily Brazilian designers, and gave Arjowiggins a chance to help them discover its full range of papers available in Brazil.
VIETNAM
Arjowiggins Security at the heart of a Vietnamese commemorative banknote Arjowiggins Security supplied the paper for the commemorative 100-dong banknote bearing the effigy of former President Ho Chi Minh, issued in April 2016 to celebrate the 65th anniversary of the Bank of Vietnam.
The banknote was printed on Diamone® Composite, a high-durability paper with anti-stain properties. Two Arjowiggins Security technologies are embedded into the banknote: the Pixel™ watermark depicting a lotus, the country’s emblematic flower, and an iridescent and fluorescent band. This commemorative banknote received a Special Achievement Award for the Asian region at the Best Regional Banknote of the Year Awards. This award recognizes the substrate produced by Arjowiggins Security, both for its artistic quality and its high-security features.
23 • Sequana • Annual Report 2016
ARJOWIGGINS GRAPHIC KALEIDO® COLOURED TISSUE
USA
Kaleido® coloured tissue goes transatlanticFor the first time ever, Arjowiggins Graphic was on exhibit at the Tissue World 2016 conference and exhibition held in New Orleans (USA), to promote its Kaleido® range of coloured tissue papers.
The trade show, fully dedicated to tissue production, enabled Arjowiggins Graphic to promote its expertise in the sector of tablecloths, tablemats and napkins where mass-dyed tissue papers are an attractive specialty. Arjowiggins has been present in this market segment for many years, and is now consolidating long-lasting partnerships with major US customers, replicating the business strategy that successfully enabled the Division to gain a solid footprint in other demanding markets, such as Germany with Easy Print®, its tissue for printing. Thanks to its constantly evolving portfolio of trendy shades, combined with in-depth knowledge of its customers’ business, Arjowiggins Graphic can offer products perfectly suited to the specific requirements of the North American market – colours and technical expertise that guarantee optimal efficiency thanks to Kaleido Easy Process!
Sequana • Annual Report 2016 • 24
FRANCE
Recycled French literature The French novelist Gilles Legardinier has chosen Eural®, a 100% recycled Arjowiggins Graphic paper, to publish his latest book entitled Le premier miracle (The First Miracle). In a tribute to his fans, the writer decided to incorporate their letters into the production process to make the paper used to print his book. He travelled to the Arjowiggins Graphic mill in Le Bourray and deposited in the pulper – the vat producing recycled pulp – all the fan letters he had received, which are now full-fledged components of his book’s DNA. The First Miracle talks about the magic of alchemy and the creation of matter from amazing recipes, spiced with a pinch of humanity and a touch of softness. Precisely the approach adopted by the writer with the virtuous loop of recycled papermaking that contributes to support a dynamic, job-creating local sector in the industry and the development of a social economy.
ASIA
Asia adopts the Vision™ watermark In the wake of the successful Pixel™ watermark adopted by ten countries and now accounting for 30 billion banknotes in circulation, Arjowiggins Security launched Vision™ in 2016. This new-generation watermark provides a more precise definition than conventional watermarks for enhanced authentication and even more security. A total of 500 million banknotes will be printed in 2017/2018 for an Asian country, on paper produced by Arjowiggins Security and incorporating the Vision™ watermark.
PARAGUAY
Latin America opts for Wink® security thread The Wink® security thread introduced in 2015 provides a dual benefit: it makes the banknote easier to authenticate and harder to counterfeit thanks to a dynamic optical effect achieved with a unique oriented-pigments technology. This innovation has gained immediate appeal in Paraguay who opted for an Arjowiggins Security paper incorporating the Wink® thread to print their new 20,000-Guarani banknote issued in early 2017.
ITALY
Teknocard® is Ferrero’s preferred choice in Italy Ferrero chose Arjowiggins Graphic Teknocard® for its new collection of stickers featuring the main characters of the film Finding Dory, inserted in their limited edition Kinder snacks. Ferrero was attracted by the excellent printability and eco-friendliness of this ISEGA-certified, premium graphic board (ISEGA is a food industry standard for food-contact materials).
USA
Eco-friendly gift cards Eager to highlight their environmental commitments, a US sportswear company has chosen Sequoia® Original as a substrate for their gift cards. This Arjowiggins Graphic paper fulfils the demands of the US market since it is biodegradable, compostable,
recyclable and 100% FSC Mix-certified. Its rigidity and strength, along with its high-quality printability, make it a true alternative to PVC.
Sequana • Annual Report 2016 • 25
“We now produce virtually all of our
creative papers at a single site.”
ARJOWIGGINS CREATIVE PAPERS
“Major large-scale projects have been achieved over the past two years, all indispensable to strengthen the global leadership of Arjowiggins Creative Papers in the creative papers market. Firstly, the largest industrial project conducted by our Division in recent years was completed in 2016, namely the transfer of production from the Charavines mill in France to the Stoneywood site in the UK. Thanks to the upgraded manufacturing equipment and to the joint engagement of everyone, we now produce virtually all of our creative papers at a single site, thus gaining in efficiency and responsiveness.
We are also proud of the strategic alliance signed with Mohawk Papers Inc. in 2015. Under this agreement, not only can we now produce the Mohawk Superfine range in its i-Tone® version for the European market, a well-renowned brand in digital printing for liquid-toner presses, but we have also launched an i-Tone® range for our flagship brands of creative papers and luxury packaging. The portfolio has been extended with a digital printing version for dry-toner presses. In the digital printing market, we provide our customers with an industrial tool perfectly suited to the short runs and premium papers needed to leverage the value of corporate communications.
Our expansion in creative papers is also backed by international markets where we signed up new distributors, like in India, Tanzania and Malawi. We share with them our expertise and knowledge of the European market, which enables them in turn to educate, or even create the market in their own countries.
Lastly, our growth continues to be driven by our specialty applications, particularly in the luxury packaging segment where we are among the major leaders of the ecosystem. This is the case as well for tracing paper, with the development of non-traditional applications such as Transprint (newspaper cover wrap), or Priplak that has taken off successfully in the US market.”
FORWARD OUTLOOKThe Graphic and Creative Papers Divisions have significantly improved their operational performance in 2016, further to the restructuring of their printing paper businesses and backed by a new scope aligned with their challenges. Update on the Division’s business by their Managing Directors.
Jonathan Mitchell,Managing Director
Arjowiggins Creative Papers
26 • Sequana • Annual Report 2016
“We are the European leader
in the recycled paper market, with an offer
of unique scope.”
ARJOWIGGINS – LOGBOOK OF A PRODUCER ON THE MOVE
ARJOWIGGINS GRAPHIC
Recycled paper is your core business. What is your added value on this market segment?We are the European leader in the recycled paper market, with an offer of unique scope, consisting of fully or partially recycled papers, and covering all graphic applications. These high-tech products respond to environmental requirements linked to the preservation of natural resources and an optimised use of the renewable fibres – i.e. cellulose – that are greatly appreciated by private and public organisations alike. This environmentally friendly dimension constitutes both the strength and the value of our customer proposition, and supports our growth.
What are your assets in the coated paper market?In two-side coated papers, we continue to be very active in France where the made in France label, the excellence of our service level and our geographic proximity to customers are major competitive assets. We have also seized the growth opportunities provided by digital printing by investing in a cutting line and a packing line at the Bessé-sur-Braye mill.
Are high value-added specialty products still as attractive and why? In specialty products, we enjoy global market positions thanks to our ability to design bespoke technical solutions tailored to our customers’ needs. For instance, we offer coloured tissue papers designed specifically for napkins and tablecloths, waterproof laminated paper for gift cards, and a range of high-end graphic board called Teknocard® that is fast growing in cosmetic and pharmaceutical packaging for the major brands.
Your strategy appears to fit into a genuine approach of responsible progress, tell us more about it. Yes indeed, we continue to reduce our energy consumption, to improve our employees’ well-being at work via safety and training, and to facilitate women’s access to all jobs, particularly in the mills. We are also resolutely engaged in developing a paper recycling sector that can generate local jobs in collection and selective sorting of papers to be recycled. We thus contribute to support 200 jobs in social entreprises, and we intend to increase this number to 250 by 2020.
Agnès RogerManaging Director
Arjowiggins Graphic
Sequana • Annual Report 2016 • 27
OUR CUSTOMERS’ PLANETPerformance and creativity are key factors of differentiation for our customers. This is why we innovate relentlessly to deliver value-added products and services. Let’s listen to what they say...
What are the specific features of Dakini’s business?Dakini For Body & Soul offers a comprehensive range of body care products. All products are made by hand with the greatest care in Southern France, and only from natural organic components. The power and uniqueness of Dakini rely on our holistic approach respectful both of the skin and the environment, along with healthy production methods.
Why did you choose Teknocard 1 100% recycled?It was essential for me to use a packaging material matching the demands of our approach, a 100% recycled material that preserves natural resources as much as possible, without however compromising on the brightness and printing quality. Couleurs d’Autan, my printer in Castres (France), immediately suggested Teknocard 1 100% recycled. In his view, the printing quality offered by this premium graphic board is identical to non-recycled board, and it lends itself perfectly to the converting requirements for beauty care products.
Was it good advice? Yes, this was excellent advice, and I am fully satisfied with the result! Premium quality packaging that meets the exacting aesthetic and eco-friendly standards reflecting the image of Dakini.
What is the meaning of the mandalas printed on each case? When designing my product lines, I relied on plants well-known and used for their unique properties for hundreds of years, such as the daisies that Cleopatra used to massage her face and preserve her legendary beauty. Each product has its own history and I designed these mandalas to give each of them a specific and recognizable visual identity. The high printing quality provided by Teknocard 1 100% recycled is ideal to showcase perfectly these subtle graphic images thanks to impeccable sharpness and printing contrast.
In 2016, Dakini chose the brand-new Teknocard 1
100% recycled premium graphic board. Dakini’s
founder Luce Aubry tell us why.
FranceDakini adopts
Teknocard
28 • Sequana • Annual Report 2016
OUR CUSTOMERS’ PLANET
Why did you decide to join the Academy of Certified Printers? Antalis, our paper merchant, is the exclusive distributor of Arjowiggins Creative Papers here in Singapore. When the Group first presented the programme to us, we were immediately drawn into it as Arjowiggins Creative Papers is a staple brand in the printing industry. We were especially interested in learning more about their papers, and in the new opportunities this programme could open to us.
Can you tell us what the different steps of the programme were for you?We first received a personal invitation from Arjowiggins Creative Papers, handed to us through Antalis. Of course, we immediately accepted to take part in the programme. We then received paper and a toolkit containing in particular dies for hot foil stamping and reference prints we were to reproduce on a number of papers. The print job brings together offset lithography, screen-printing, hot foil stamping and embossing, which does add some complexity in terms of registration. We were able to sub-contract some of the techniques which we don’t handle in-house, but strictly controlled the quality delivered. A jury in Paris then evaluated the printed pieces. Having reached their expectations, we have now been certified!
What did you learn in the process?What was especially interesting to us was the opportunity to print on a variety of creative papers with different colours, textures, and even special effects. The selection included papers such as Curious Matter Désirée Red, Curious Skin Black and Rives Sensation Gloss Tradition Bright White. We were also able to try different printing techniques on this selection of papers, and see the outcome of the same artwork on very different materials.
What advantages are you expecting from the Academy?We were honoured to receive a diploma from Arjowiggins Creative Papers. Their marketing director, Christophe Balaresque, came in person to award the diploma, which is now proudly on display in our office. We are also now present on their website arjowigginscreativepapers.com, giving us international visibility and the seal of approval of Arjowiggins Creative Papers.
ARJOWIGGINS – LOGBOOK OF A PRODUCER ON THE MOVE
SingaporeAcademy
of Certified Printers
Last year, Arjowiggins Creative Papers launched the Academy of Certified
Printers in Asia-Pacific. The objective: give participating printers recognition
for printing perfectly on our creative papers. Jeremy Toh is the Director
of Print Dynamics (S) Pte Ltd. The print shop was established
in 1991 in Singapore, and specialises in high-end offset lithography.
Print Dynamics (S) Pte Ltd was one of the first printers to be
certified by the Academy. Mr. Toh answers our questions.
Sequana • Annual Report 2016 • 29
As a socially responsible stakeholder, Sequana has traced out a CSR roadmap shared by its distribution and production businesses for the 2016-2020 period. Guided tour.
A RESPONSIBLE JOURNEY
30 • Sequana • Annual Report 2016
Sequana • Annual Report 2016 • 31
CSR ON THE ROAD TO 2O20
In the context of its Corporate Social Responsibility (CSR) policy initiated in 2012, Sequana has drawn up a roadmap for the period 2016-2020.
This roadmap revolves around 4 pillars combining 7 initiatives intended to respond to the major challenges related to the Group’s business activities. Each of these initiatives is the subject of an action plan associated with performance or monitoring indicators. This common strategy, based on the ISO 26000 standard and shared by all production (Arjowiggins) and distribution (Antalis) activities, ensures that the major impacts of the Group’s activities are taken into account, in full compliance with a normalised and internationally standardised framework.
32 • Sequana • Annual Report 2016
“It is crucial for the future of Sequana to have a transparent, ambitious CSR policy that is fully integrated into the Group’s business model.”
2 BUSINESS ETHICS
Vision > Ensure that the Group’s activity, wherever it operates in the world, is carried out in full compliance with the internal Code of Conduct and with international and national regulations, more particularly regarding issues of competition law and anti-corruption regulations.
Targets 2020 > 100% of at-risk employees trained in good business conduct every 2 years, more specifically on issues of competition law.
1CSR POLICY, REPORTING & CORRESPONDENTS’ NETWORK
Vision > Develop — via a coordinated correspondents’ network in all businesses — a CSR policy which incorporates quantified targets and clearly identified actions, associated with standardised reporting procedures and checked by independent third parties.
Targets 2020 > Consistently mainstream CSR-related issues, tools and procedures at the core of the Group’s business model.
7 ECO-RESPONSIBLE PRODUCTS
Vision > Develop the demand for eco-responsible products by offering innovative product ranges, and promoting the offer of recycled products contributing to a circular economy.
Targets 2020 > • Define and develop the
offer of eco-responsible Packaging and Visual Communication products (Antalis).
• 100% procurement to be FSC or PEFC certified (Arjowiggins).
• 55% of sales volume in recycled products (Arjowiggins Graphic).
3 TRACEABILITY AND RESPONSIBLE SOURCING
Vision > Reinforce the traceability of products in order to eliminate at-risk procurement sources, to increase the contribution of sustainable sourcing and bolster circular economy solutions.
Targets 2020 > • Ensure that 100%
of pulp procurement (Arjowiggins) are covered under a traceability procedure that includes reasonable due diligence.
• Reach 85% traceability coverage for all purchases (paper and non-paper) at Antalis.
5 SAFETY AT THE WORKPLACE
Vision > Guarantee a safe and healthy work environment — with an ambition of zero accident and zero occupational illness in all areas — while improving well-being in the workplace and performance conditions for employees.
Targets 2020 > • Arjowiggins:
Lost-time accidents index = 9 (i.e. -52% vs. 2015).
• Antalis: Lost-time accidents index = 7 (i.e. -30% vs. 2015).
• Roll out the OHSAS 18001 certification in the 20 main warehouses (Antalis).
6 TRAINING AND APPRENTICESHIP
Vision > Reinforce continuing training and create jobs — particularly via various forms of apprenticeship — in order to respond to changes in the market.
Targets 2020 > • 80% of employees
trained annually (Antalis, Arjowiggins Creative Papers, Arjowiggins Security).
• Reach 14 hours of training per employee per year (Antalis).
4 ENERGY AND WATER MANAGEMENT
Vision > Mitigate the environmental impacts linked to energy consumption and to the quality of water discharges to the natural environment, in particular by increasing the energy efficiency of manufacturing processes and reducing the transport-related carbon footprint.
Targets 2020 > • 6% energy efficiency
improvement at production sites (in KWh per tonne produced), i.e. a reduction of 100 GWh.
• 100% manufacturing sites to be certified ISO 50001 (energy management system).
• Initiate the ISO 50001 certification process in the main logistics warehouses.
NATURAL RESOURCES
HUMAN RESOURCES
PRODUCT OFFERGOVERNANCE
Pascal LebardChairman & CEO of Sequana, Chairman of Antalis and Arjowiggins
A RESPONSIBLE JOURNEY
Sequana • Annual Report 2016 • 33
DESTINATION: STAFF & SAFETY
Following an increase in the Lost Time Accident frequency rate in 2015, Arjowiggins was unable to reduce this rate in 2016 despite satisfactory results in most industrial sites. In order to reverse this trend, each Division has committed to review its safety management system every year, in compliance with OHSAS 18001 standard. The process established in 2016 provides for enhanced control over the consistency and efficiency of the local actions plans, and for improved sharing of issues and best practices between the sites. It also contributes to establishing a corporate safety culture that extends over and above the local scope of the sites.
Another highlight of the year at Arjowiggins was the kick-off of the Chemicals project listed in the 2016/2020 plan. The goal is to ensure the sites’ compliance with applicable regulations and to share best practices. When rolling out this project, Arjowiggins has adopted a module-based approach, focusing first on three tangible topics: CMR (Carcinogenic, Mutagenic, Reprotoxic) substances, storage and handling of chemicals. An auditing tool and a 5-score evaluation matrix – from basic standard requirements up to best available practices – have been implemented to enable each site to carry out a self-assessment. The ultimate goal for each module is to align the 13 Arjowiggins mills as quickly as possible with the minimum standard and to aim for the best practices by 2020.
After steadily improving its Lost Time Accident frequency rate for several years, Antalis has experienced a plateau since 2015. Antalis’s efforts to mainstream safety into its DNA and re-launch the progress momentum rely on awareness and training initiatives for the entire personnel. The actions implemented to this purpose include Safety seminars dedicated to risk identification and management (organised in Sweden, Poland and Romania in 2016) and training sessions on the WeConnect e-learning platform. The first Safety Initiation module is now available, along with other learning modules developed by the regions. The Western Europe region has for instance developed a module dedicated to safe driving for the staff who use vehicles on the job. A new section was created on WeConnect, dedicated to the Antalis Health & Safety community. The idea is to strengthen experience sharing via forums and project-based spaces, and to collect best practices categorised by types of risks or activities, or based on the various chapters of the OHSAS 18001 standard.
Specific initiatives were also carried out by the regions. For instance, the UK and Ireland have reformatted their auditing tool, launched monthly Safety Talks on specific topics, and communicated about a Health & Safety glossary.
Developing employees’ skills and safety at the workplace remain the two key priorities for Sequana.
34 • Sequana • Annual Report 2016
A RESPONSIBLE JOURNEY
Enriching and accelerating training sessions Developing our employees’ skills is essential to make the organisation constantly more efficient and deliver excellence to our customers. To this purpose, Antalis relies on the Group’s intranet WeConnect which includes an e-learning platform where employees can access learning modules about the Group’s products and services, as well as standard training courses to develop their professional skills. WeConnect is accessible by all employees regardless of their roles in all 43 countries where the Group operates. The e-learning platform offers hundreds of short training modules, some of which are available in over 20 languages. More comprehensive training programmes have also been developed for key roles. After creating the Sales Academy in late 2010, dedicated to the sales force and managers, Antalis launched the Purchasing Academy in early 2016, a training curriculum targeting all staff members in the Group’s purchasing departments. This 30-hours, 18-months long programme, administered primarily on line, focuses on the key skills of the purchasing function. It includes top-down learning modules along with practical case studies. The Purchasing Academy has proved highly successful, thanks in particular to the strong engagement of the Group Purchasing Director, as sponsor of the programme, and to close monitoring by Regional Purchasing Managers. Statistics are sent out regularly to help the managers assess the progress achieved by their staff members and take any corrective measures as needed. Nearly 60 employees have already attended this training programme since its creation, and all of them unanimously agree on the quality of the contents and the possibility of putting their learnings into practice very quickly. Backed by this success, a second training session will start in 2017 to help other purchasing staff members develop their skills.
E-LEARNING EARNING ITS CREDENTIALS The success of e-learning, whatever the programmes, is undeniable among the Antalis personnel. More than 3,500 employees attended an e-learning session in 2016, i.e. a growth of 60% versus 2015. Overall for all training sessions offered on WeConnect, a total of 13,000 modules were followed, i.e. an average of six 20-minutes modules per person.
0
10
20
30
40
50
60
70
80 21
15
10
5
0
Number of Lost Time Accidents
Lost Time Accident frequency rate Lost Time Accident frequency rate Antalis
Number of Lost Time Accidents Antalis
Lost Time Accident frequency rate Arjowiggins
LTA frequency rate = number of lost-time accidents / number of employees and full-time temp workers x 1,000.
Data calculated on a scope of 96 distribution centres for Antalis, 13 mills and converting facilities and 2 R&D centres for Arjowiggins, including corporate head offices and sales branches.
Number of Lost Time Accidents Arjowiggins
2014 2015 2016
People safety
Sequana • Annual Report 2016 • 35
WORLDWIDE
8,530employees
ANTALIS 5,626
ARJOWIGGINS 2,852
SEQUANA 52
Antalis Arjowiggins Sequana/SRS TOTAL
Number of training days per employee in 2016 17.5 34.4 2.3 23.0
Number of training days per employee in 2015 8.5 14.0 4.6 12.6
76 381
North America ARJOWIGGINS 76ANTALIS -
Asia-Pacific ARJOWIGGINS 158ANTALIS 223
Europe ARJOWIGGINS 2,616ANTALIS 4,520SEQUANA/SRS 52
327
2,315o/w. France
ARJOWIGGINS 1,659ANTALIS 604
SEQUANA/SRS 52
558
South AmericaARJOWIGGINS - ANTALIS 558
Africa-Middle East ARJOWIGGINS 2ANTALIS 325
HUMAN RESOURCES INDICATORS 2016
7,188
36 • Sequana • Annual Report 2016
Breakdown by age Breakdown by seniority
Percentage of women in management in 2016
Training
TOTAL TOTAL
Breakdown by gender
Group
Arjowiggins
Antalis
Percentage of disabled workers in 2016
2016 2015 2014 Arjowiggins 2,852 3,537 3,977
Antalis 5,626 5,694 5,585
Sequana and Sequana Resources & Services (SRS) 52 52 53
TOTAL 8,530 9,283 9,615
Average headcounts per company
Men
85.6%
Men
63.3%
Antalis Arjowiggins Sequana/SRS TOTAL
Number of training days per employee in 2016 17.5 34.4 2.3 23.0
Number of training days per employee in 2015 8.5 14.0 4.6 12.6
Women
29.6%
Women
14.4%
Women
36.7%
2015 2016 2015 2016
Arjowiggins
Antalis
Arjowiggins
Antalis
Sequana/
SRS
Sequana/
SRS
Arjowiggins Arjowiggins
29.5%
0.9%
23.5%
2.3%
22.3%
2.1%
36.7%
27.2%
1.4%
28.8%
1.21%19.0%
0%
30.8%
0.8%
Antalis Antalis
A RESPONSIBLE JOURNEY
-30years
30-40 years
40-50 years
50-60 years
+60 years
16%15%
31% 30%
8%
25%
6%
33%
25%
11%
- 1year
1-5 years
5-10 years
10-20 years
+20 years
4%
9%
24%
18%
34%
27%
20%
17%
22%
25%
Men
70.4%
Sequana • Annual Report 2016 • 37
Production
Production of virgin pulp
Production of recycled pulp
Production of papers
Arjowiggins 100% certified or recycled pulp
Commitment to 6% reduction in energy consumption
by 2020
Forestry operations
Preservation of resources Climate change
People Safety
CSR ISSUES
EXISTING CERTIFICATIONS
ADDITIONAL GROUP INITIATIVES
Certifications for Responsible Forestry Management
ISO 14001 / ISO 50001 / OHSAS / 18001Certifications for production sites(1)
AT THE HEART OF TRACEABILITY
38 • Sequana • Annual Report 2016
Distribution End of life
Distribution
Separate collection of office papers
Printers
Resellers
Mass retail Private customers
Companies
Companies Publishers Communication agencies
Green Star SystemClassification of Antalis products
rated 0 to 5 stars according to their level of eco-friendliness
Antrak Platform dedicated to Antalis’s suppliers to ensure full control
over the supply chain
Community partnerships• Partnerships with local work-based
inclusion social enterprises • Stakeholder in the circular economy
Broadest offer of recycled and eco-friendly products
on the market
Eco-calculatorCalculates the environmental impact
reduction of a paper
People Safety
Traceability Eco-responsible productsReduce – Reuse - Recycle
Waste reductionCircular economySocial economy
Throughout its life cycle, paper has to meet numerous social and environmental challenges. In order to deliver to our customers all guarantees of a responsible value chain, the Group relies on existing certifications as well as many other initiatives.
Sorting
(1) CertificationsISO 14001: Environmental Management systemISO 50001: Energy Management systemOHSAS 18001: Health & Safety Management system(2) Imprim’Vert: Environmentally-friendly printing label
Certifications for Responsible Forestry Management
ISO 14001 / ISO 50001 / OHSAS / 18001
Imprim’Vert(2)10-31-2629
GRAPHIC CREATIVE PAPERS HEALTHCARE SECURITY TOTAL
Unit 2016 2015 2016 2015 2016 2015 2016 2015 2016 2015
Water consumption Water use/Net sellable production
m3/T. paper 12.5 12.9 60.4 66.0 40.3 42.7 84.4 75.9 23.5 24.1
Water released back into the natural environmentReleases/Net sellable production
m3/T. paper 11.3 12.1 54.7 59.4 27.4 29.2 87.2(3) 73.8 21.4 21.6
Percentage released back into the natural environment % 91 93.8 90.7 90.0 68.0 68.4 103.3 97.2 91.2 89.6
Analysis of total suspended solids (TSS)TSS effluent/Net sellable production
Kg/T. paper 0.20 0.21 1.04 1.07 0.21 0.22 0.65 0.61 0.35 0.34
Analysis of chemical oxygen demand (COD)COD/Net sellable production
Kg/T. paper 1.35 1.52 5.06 5.97 3.38 3.49 4.06 3.43 2.09 2.30
Analysis of biochemical oxygen demand after 5 days (BOD5)BOD5/Net sellable production
Kg/T. paper 0.10 0.11 0.73 1.03 0.71 0.77 0.20 0.20 0.22 0.28
Analysis of nitrogen (N)N/Net sellable production
Kg/T. paper 0.06 0.07 0.07 0.08 0.07 0.11 0.33 0.25 0.07 0.08
Analysis of phosphorus (P)P/Net sellable production
Kg/T. paper 0.007 0.005 0.049 0.050 0.001 0.003 0.099 0.071 0.015 0.013
Analysis of nitrogen oxide (NOx)NOx/Net sellable production
Kg/T. paper 0.31 0.29 7.12 6.85(4) - - - - 0.52 0.50(5)
Analysis of CO2 (scope 1)(1)
CO2 emissions /Net sellable productionKg/T. paper 274 275(5) 1,103 1,144 14 15 613 641 405 384
Analysis of CO2 (scopes 1 & 2)(1)
CO2 emissions/Net sellable production
Kg/T. paper 409 439 1,365 1,436 131 131 1,614 1,668 591 596
Analysis of Gas consumption (energy)Gas consumption/Net sellable production NCV
KWh/T. paper 1,335 1,340(5) 5,375 5,578(5) 66 61 2,987 3,126 1,969 1,871
Analysis of Steam purchased externally (energy)Steam purchased/Net sellable production
KWh/T. paper 329 330(5) 136 154(5) 2,234 2,155 - 353 421
Analysis of Electricity consumption (energy)(2) Electricity consumption /Net sellable production
KWh/T. paper 709 703(5) 278 244(5) 957 974 3,877 3,789 774 785
Analysis of Energy consumptionTotal energy consumption/Net sellable production
KWh/T. paper 2,376 2,375(5) 5,794 5,980(5) 3,259 3,192 6,866 6,917 3,099 3,080
Note: Values given as a ratio per tonne of sellable paper are the average values for all production activities across the Group; significant differences may exist among the sites depending on the products manufactured. These values are aligned with the data reported by the most efficient paper manufacturers who produce comparable paper grades.
ENVIRONMENTAL INDICATORS 2016
40 • Sequana • Annual Report 2016
GRAPHIC CREATIVE PAPERS HEALTHCARE SECURITY TOTAL
Unit 2016 2015 2016 2015 2016 2015 2016 2015 2016 2015
Water consumption Water use/Net sellable production
m3/T. paper 12.5 12.9 60.4 66.0 40.3 42.7 84.4 75.9 23.5 24.1
Water released back into the natural environmentReleases/Net sellable production
m3/T. paper 11.3 12.1 54.7 59.4 27.4 29.2 87.2(3) 73.8 21.4 21.6
Percentage released back into the natural environment % 91 93.8 90.7 90.0 68.0 68.4 103.3 97.2 91.2 89.6
Analysis of total suspended solids (TSS)TSS effluent/Net sellable production
Kg/T. paper 0.20 0.21 1.04 1.07 0.21 0.22 0.65 0.61 0.35 0.34
Analysis of chemical oxygen demand (COD)COD/Net sellable production
Kg/T. paper 1.35 1.52 5.06 5.97 3.38 3.49 4.06 3.43 2.09 2.30
Analysis of biochemical oxygen demand after 5 days (BOD5)BOD5/Net sellable production
Kg/T. paper 0.10 0.11 0.73 1.03 0.71 0.77 0.20 0.20 0.22 0.28
Analysis of nitrogen (N)N/Net sellable production
Kg/T. paper 0.06 0.07 0.07 0.08 0.07 0.11 0.33 0.25 0.07 0.08
Analysis of phosphorus (P)P/Net sellable production
Kg/T. paper 0.007 0.005 0.049 0.050 0.001 0.003 0.099 0.071 0.015 0.013
Analysis of nitrogen oxide (NOx)NOx/Net sellable production
Kg/T. paper 0.31 0.29 7.12 6.85(4) - - - - 0.52 0.50(5)
Analysis of CO2 (scope 1)(1)
CO2 emissions /Net sellable productionKg/T. paper 274 275(5) 1,103 1,144 14 15 613 641 405 384
Analysis of CO2 (scopes 1 & 2)(1)
CO2 emissions/Net sellable production
Kg/T. paper 409 439 1,365 1,436 131 131 1,614 1,668 591 596
Analysis of Gas consumption (energy)Gas consumption/Net sellable production NCV
KWh/T. paper 1,335 1,340(5) 5,375 5,578(5) 66 61 2,987 3,126 1,969 1,871
Analysis of Steam purchased externally (energy)Steam purchased/Net sellable production
KWh/T. paper 329 330(5) 136 154(5) 2,234 2,155 - 353 421
Analysis of Electricity consumption (energy)(2) Electricity consumption /Net sellable production
KWh/T. paper 709 703(5) 278 244(5) 957 974 3,877 3,789 774 785
Analysis of Energy consumptionTotal energy consumption/Net sellable production
KWh/T. paper 2,376 2,375(5) 5,794 5,980(5) 3,259 3,192 6,866 6,917 3,099 3,080
A RESPONSIBLE JOURNEY
(1) These data were collected from 13 Group mills operational in 2016. Emission factors are derived from the ADEME database for 2015.(2) The analysis of total energy consumption includes electricity, gas, steam and biomass, as well as fuel-oil and coal consumptions (not included in the chart).(3) Volumes of water released back to the natural environment that are higher than water abstraction volumes in the Security Division are due to rainwater
recovery systems that are not counted in the abstracted water volumes.(4) 2015 data on this indicator were amended due to a now-corrected error in feedback data.(5) 2015 data were adjusted to keep a like-for-like scope of mills.
Sequana • Annual Report 2016 • 41
RESPONSIBLE CONSUMPTION
In order to promote responsible consumption, a priority for many organisations, Antalis and Arjowiggins offer the broadest choice of innovative, recycled and eco-friendly papers on the market for graphic and specialty applications.
Digigreen is the latest born in the Antalis range of graphic papers. This coated paper designed for digital printing provides printers with optimum performance and high cutting precision. It is the only recycled digital paper rated five stars under the Antalis Green Star system and awarded all major environmental certification labels. The Arjowiggins Graphic Cocoon line has been expanded with the Cocoon 60 FSC® Mix certified version. This paper manufactured from 60%
recycled fibres and 40% certified virgin fibres delivers ultimate whiteness, excellent opacity and very short drying time.
On the specialty paper side, in response to the growing demand for paper bags further to the general ban on plastic bags, Arjowiggins Graphic has developed the PACK range dedicated to the luxury paper-bag market and complying with the most stringent environmental certifications (FSC®, European Ecolabel, Blue Angel). As an eco-friendly alternative for brands seeking environmentally friendly packaging for their clientele, the PACK range enables Arjowiggins Graphic to deliver virtually any packaging solutions in a 100%-recycled version.
A broad range of eco-responsible products(1)
97%for Arjowiggins Graphic
97%for Arjowiggins Creative Papers
74%for Antalis (2)
The Group’s eco-friendly offer accounts for the following volumes
(1) For Arjowiggins Security, due to the small proportion of wood fibre in finished products, the initial definition specifically dedicated to paper products is not significant.(2) Percentage based on products in stock (in % of sales).
Even in an all-digital era, paper still has a legitimate role to play, provided it is blended into an exacting eco-responsible approach. In line with this mindset, the Group further bolstered its initiatives and commitments on eco-responsibility this year.
TOWARDS AN EVER-MORE RESPONSIBLE OFFER OF ECO-FRIENDLY PAPERS
42 • Sequana • Annual Report 2016
Cocoon, sustainably riding the Paris metroRATP, the Paris Urban Transit Authority, has chosen to use the Cocoon range of 100% recycled ultra-white papers for its various communication materials (corporate reports, brochures, etc.), attracted by the appeal of its environmental assets, excellent printing quality and cost-efficiency. Another highly appreciated asset is the “Made in France” label of this paper range, a market positioning that fully matches the RATP’s CSR approach, making it an ideal choice for all the staff who use it.
SUPPORTING OUR CUSTOMERS IN THEIR RESPONSIBLE APPROACH
Three years ago, Antalis developed the Green Star System to help its customers choose a paper according to its eco-friendliness level. Based on two criteria — source of the raw materials and manufacturing process — this rating grid awards 0 to 5 stars to a given paper according to its environmental performance. All Antalis papers are rated in the Green Star System, and must be granted at least 3 stars to be regarded as eco-responsible.
The Arjowiggins Graphic eco-calculator, accessible and downloadable on line, enables customers to measure the reduction of the environmental impact of a document printed on recycled paper versus virgin-fibre paper. Companies can display on their communication material the savings achieved on natural resources (wood, energy, water, CO
2 emissions,
waste) to showcase their environmental commitments.
In order to raise awareness on responsible consumption, Antalis and Arjowiggins are increasing their participation in special events, and organise training sessions and seminars for their customers, addressing for instance such topics as “The benefits of choosing recycled paper” or “The high performance of responsible recycled papers”.
Fiat Chrysler opts for Cocoon Offset in Italy In a concern for mitigating the impact of their activities on the environment, Fiat Chrysler Automobile has opted for the 100% recycled Cocoon Offset paper to print their annual corporate and sustainability reports. As a testimony of their commitment, the documents publish the natural resources savings achieved, in an effort to raise their customers’ awareness on the importance of using recycled paper.
A RESPONSIBLE JOURNEY
Sequana • Annual Report 2016 • 43
COMMUNITY ENGAGEMENTAs a responsible stakeholder fully engaged in society, Sequana has for many years followed a policy of partnerships focused on culture and childhood. The Group, along with its subsidiaries, is involved in numerous outreach initiatives in favour of local communities.
Partners in the world of cultureFor many years now, Sequana has supported the arts and culture to ensure that creation is made more accessible to everyone. Via its partnerships, the Group has supported iconic institutions like Le Louvre Museum since 2003 or more recently the Pompidou-Metz Museum. In addition, Sequana collaborates with the FIAC Contemporary Art Fair for the 8th year in a row. Ever since the start of these partnerships, over 130 art books have been printed on the Group’s graphic and creative papers.
Arjowiggins Graphic is also very active in this area. For the third consecutive year, Arjowiggins Graphic has partnered with the “Fête du Graphisme”, an international event fully dedicated to the development, promotion and dissemination of graphic arts. This year, Arjowiggins Graphic customers were invited to an evening party organised at the core of the exhibit at the Cité Internationale des Arts to admire the artworks of international graphic designers and
try out their hand at screen-printing on Cyclus Offset, the Group’s 100% recycled paper.
Fighting diseasesHealthcare is another chosen field of commitment for the Group. In 2016, Sequana was engaged by the side of the Info-Endométriose Association by supplying the paper needed for the nation-wide poster campaign on the complex endometriosis condition that affects one out of ten women, with a triple goal: enhance knowledge about this disease to shorten the diagnostic time, propose better treatment, and improve the quality of life for all women suffering from the disease ➊.
Antalis has renewed its traditional Wear it Pink initiative in the UK in support of the fight against breast cancer. Antalis employees also rallied around to support the CLIC Sargent association — supporting children and teenagers suffering from cancer — by cycling 500 miles and selling cakes to the benefit of the association ➋.
➊
➋
44 • Sequana • Annual Report 2016
They also competed in the Suffering Race to collect funds donated to the Cynthia Spencer Hospice. In the Czech Republic, Antalis continued to support the RWTTC association (Running With Those That Can’t) helping the inclusion of disabled children in day-to-day life by supplying wheelchairs equipped for handisports ➌.
Funding projects in favour of disadvantaged childrenFor many years now, Arjowiggins Graphic via its Cyclus recycled paper brand has supported NGOs working in education for disadvantaged children everywhere across the world. In 2016, Arjowiggins Graphic partnered with the NGO Un Enfant par la Main (Child Fund Alliance) to support girls’ education in India. The girls must sometimes walk a long way to school, which prevents them from attending school regularly. A video film depicting the problem was posted on the Cyclus website and for every 50 views Arjowiggins Graphic funded the purchase of a bicycle to be donated. With over 5,000 views in Europe, Arjowiggins Graphic thus funded 100 bicycles donated to girls who can now ride to school every day ➍.
Sequana supported the Kids & Artists association working to improve children’s daily life via sales of co-created artworks. Following an initial project in South Africa with a Zulu school, the association decided in 2016 to support an orphanage in southern Morocco to help disabled infants and children live in decent conditions. Drawing workshops were organised with help from committed artists, and the orphanage children produced 80 artworks on paper supplied by Sequana. Proceeds from an auction sale of these drawings provided funding for the daily operation of the abandoned children nursery in Ouarzazate for 7 months ➎.
Arjowiggins Security contributed to sight-impaired education in the context of a seminar organised for the first time in the world under the aegis of the Bangladesh Central Bank. This event enabled 300 sight-impaired persons to learn how to identify the value of a banknote and to detect counterfeit banknotes.
A RESPONSIBLE JOURNEY
Lastly, Antalis Hong Kong who is closely involved in causes in favour of children’s education, supplied the paper needed for the Little Artists, Big Dreams drawing competition, launched on the occasion of the China Children Week (CCW). This contest joined by nearly 1,000 competitors under age 12, raised funds donated to help disadvantaged children and their families gain access to basic medical care. Antalis Hong Kong was similarly engaged by the side of the Chi Heng Foundation and Save The Children Hong Kong, two charity organisations supporting educational projects for disadvantaged children and adults and fighting discrimination. The paper donated by Antalis was used to print programmes and invitations to fund-raising dinners.
Reaching out to the communitiesSince 2013, Sequana has been advocating the engagement of its personnel at headquarters via its RéciproCité project that enables employees to get personally involved in outreach initiatives in partnership with local community organisations. In 2016, employees donated 428 hours of their own time to community initiatives in the field of academic support, aid to professional inclusion, cultural and sports activities ➏. Nearly 50 headquarter employees along with young volunteers from the local CEBIJE youth centre (Centre Boulonnais d’Initiative Jeunesse) formed the RéciproCité team to compete in the Heroes Race organised on behalf of several charities. This charitable race raised donations from over 80 employees at headquarters. The funds collected were turned over to the Sainte Geneviève association supporting community outreach initiatives and educational and cultural projects in the Hauts-de-Seine county. This operation enabled a number of disadvantaged youngsters to leave on a weekend holiday ➐.
➌
➍
➎
➏
➐
Sequana • Annual Report 2016 • 45
SHAREHOLDER’S GUIDE
46 • Sequana • Annual Report 2016
SHAREHOLDER’S GUIDE
Sequana • Annual Report 2016 • 47
GOVERNANCESequana’s Board of Directors comprises five independent Directors out of ten members. Its membership complies with the recommendations of the AFEP-MEDEF corporate governance code and with statutory provisions, both in terms of Directors’ independence and of gender equality (40% female Directors). The Board met on 15 occasions in 2016, with a Directors’ attendance rate at 92%.
The Board’s Committees act within their respective remit as defined by the Board of Directors. While they proactively prepare the Board’s work and draft proposals, they have no decision-making power. The Committees report on a regular basis to the Board who takes decisions that are then reported to the shareholders by the Board Chairman.
• Nominations and Compensation Committee chaired by Jean-Yves DuranceIt comprises three members. Its prerogatives cover the compensation paid to corporate officers and key executives, and the Group’s policy on stock-options and free-share awards. It also reviews matters relating to the membership, organisation and operation of the Board and its committees. The Nominations and Compensation Committee met 3 times in 2016, with an attendance rate of 100%.
• Audit Committee chaired by Jean-Pascal BeaufretIt comprises three members with long-standing experience and sound financial and accounting expertise. It focuses on five areas: verification of accounting principles; approval of half-yearly and annual corporate and consolidated financial statements; internal control; review of the Group’s financial position and any risks to which it may be exposed; and the status of Statutory Auditors (appointment, independence). The Audit Committee met 6 times in 2016, with an attendance rate of 92%.
• Strategy Committee chaired by Jean-Pascal BeaufretIt comprises five members renowned for their knowledge of the Group or their experience in distribution. It makes proposals to the Board on the Group’s key strategic orientations, and reviews investment opportunities. The Strategy Committee met 3 times in 2016, with an attendance rate of 89%.
BOARD COMMITTEES
48 • Sequana • Annual Report 2016
Pascal Lebard(1)
54 years old, Chairman & Chief Executive Officer, Chairman of Antalis and Arjowiggins
Michel Giannuzzi(1)
52 years old, independent director, Chairman of the Executive Management Board of Tarkett
Jean-Pascal Beaufret
66 years old, Vice-Chairman, independent director, partner and member of the Management Board of Portalis AM, partner and member of the Investment Committee of Aurinvest Capital 3
Jean-Yves Durance(1)
74 years old, independent director, Chairman & Chief Executive Officer of Société Immobilière du Palais des Congrès (SIPAC)
Christine Bénard
49 years old, independent director, Chief Executive Officer of G-G+
Luc Argand
69 years old, director, Partner at the law firm Pfyffer & Associés (Switzerland)
Isabelle Boccon-Gibod
49 years old, director
Amélie Finaz de Villaine(1)
35 years old, director, Investment Director at Bpifrance Investissement
Bpifrance Participations, board member represented by
Éric Lefebvre
49 years old, Investment Director at Bpifrance Investissement
Cécile Helme-Guizon
51 years old, independent director, Strategy Director of Darty
BOARD OF DIRECTORS
(1) Subject to approval by the Shareholders General Meeting of 6 June 2017
SHAREHOLDER’S GUIDE
Sequana • Annual Report 2016 • 49
SEQUANA GROUP RESULTSThe Group’s operating performance in 2016 reflects not only the good resilience of Antalis, although penalised by the negative impact of currency fluctuations, but also the sharp turnaround of the Creative Papers and Graphic Divisions.
Highlights
Continued strategic expansion of Antalis in Packaging and Visual Communication and ongoing consolidation of the paper distribution market • Acquisition of TFM Industrial in Peru,
a specialist distributor of technical packaging solutions to the agri-food, pharmaceutical and building industries (2016 sales: ca. €5 million).
• Acquisition of Gregersen in Norway, a distributor of visual communication equipment and consumables. (2016 sales: ca. €6 million).
• Acquisition of the paper distribution business of Swan Paper in Ireland (2016 sales: ca. €13 million).
Strengthening of Arjowiggins financing capacity • Sale of Arjowiggins Healthcare to Meeschaert
Private Equity in partnership with the company's executive management team, for an enterprise value of €33 million.
• Sale of the 15% equity stake held in Arjo Systems and Arjo Solutions (security solutions) for €7 million.
Recent events
Sequana has entered into a preventive (“Sauvegarde”) procedure and announced a plan intended to exit this procedure rapidly:
• Planned disposal of Arjowiggins Security BV (banknote business in the Netherlands) to Oberthur Fiduciaire for a gross amount of €30 million.
• Launch of a disposal process for the Banknote France business (Security Division).
• IPO(1) of Antalis through a distribution of Antalis International shares to Sequana shareholders.
(1) Subject to approval by the Annual Shareholders Meeting of 6 June 2016
50 • Sequana • Annual Report 2016
Group’s Shareholders Equity (in € million)
Sales by geographic regions
2014 2015 2016
588
468
390
Sales by segment
51%Europe (excl. France & UK)
35%Europe
(excl. France & UK)
12%Rest of World
16%Rest of World
12%France
27%France22%
UK
22%UK
3%USA
Net attributable income/loss (in € million)
2014 2015 2016
117
(67)(52)
The net loss attributable to owners was €52m after deducting €72m in net non-recurring expenses.
Net debt (in € million)
Average headcount by geographic region
2014 2015 2016
311
235
315
The €80m decline reflects the net positive impact of disposal proceeds for €18m, and the negative impact of disbursements related to restructuring costs and other non-recurring items for €93m.
Sales(1)
(in € million)
2014 2015 2016
3,369
3,179
3,300
3,1532,975
2,933
Sales were down 9.9% as reported (-6.6% at constant exchange rates). Proforma sales were down 7%, and down 3.5% at constant exchange rates.
EBITDA(1)
(in € million)
2014 2015 2016
124
102
126
106
107
105
EBITDA was down 14.9% as reported. Proforma EBITDA was down 1.1% (- 5.8% for Antalis and +14.0% for Arjowiggins), with EBITDA margin at 3.6% of sales.
Recurring operating income(1)
(in € million)
2014 2015 2016
72
57
73
57
63
61
Recurring Operating Income was down €10m as reported. Proforma Recurring Operating Income was up 7.5% and accounted for 2.1% of sales (+ 0.3 point).
58%Antalis Papers
4%ArjowigginsSecurity
8%Antalis Visual Communication
16%Antalis
Packaging
10%Arjowiggins
Graphic
4%Arjowiggins
Creative Papers
Published data Proforma data KEY FIGURES
SHAREHOLDER’S GUIDE
(1)
Sequana • Annual Report 2016 • 51
20%Packaging
9%Visual Communication
71%Papers
39%Rest of Europe
20%Rest of World
11%France
9%Germany/Austria
21%UK/Ireland
Sales per business sector
40%Rest of Europe
9%Rest of World
11%France
13%Germany/Austria
27%UK/Ireland
Sales per geographic region
Average headcount per geographic region
38%Rest of Europe
11%Rest of World 51%
Main European countries
EBITDA per geographic region
5,600employees in 43 countries
118distribution centres
1.5 milliontonnes of paper distributed
Sales of
€2,459 MEBITDA of
€88 M
ANTALISThe sales of Antalis, down 6.3% in 2016 (-2.3% at constant exchange rates), were penalised by the adverse Forex impact (€109 million) and by lower paper volumes in a sharply declining market.
EBITDA was close to the level of 2015 excluding negative Forex impact (i.e. €5 million primarily due to the Sterling depreciation). The EBITDA margin was stable at 3.6% of sales.
SHAREHOLDER’S GUIDE
52 • Sequana • Annual Report 2016
ARJOWIGGINS
6%Rest of World
58%France
22%UK
3%USA
11%Europe
(excl. France & UK)
Headcount per geographic region
Sales per Division
7%Rest of World
15%Asia
20%France
12%USA
9%UK
37%Europe (excl. France & UK)
Sales per geographic region
45%Graphic
55%Creative Papers
EBITDA per Division(1)
(1) Excluding €13 M in negative EBITDA from the Security Division.
2,800employees
13production and converting facilities
Over
470,000tonnes of paper sold
Sales of
€710 MEBITDA of
€30 M
SHAREHOLDER’S GUIDE
Proforma sales stood at €668 million, down 11.9% (-10.7% at constant exchange rates). Sales were negatively impacted by the persistent weakness of the order book in the Security Division and the continuing decline of printing paper volumes, further amplified in the standard coated segment by the closure of the Wizernes mill in 2015. Proforma EBITDA stood at
€28 million, up 14.0%. This improvement confirms the sharp turnaround of the operating performance of the Creative Papers and Graphic Divisions, supported by lower raw materials and energy costs. Excluding the Security Division, Arjowiggins’ pro forma EBITDA jumped from €15 million in 2015 to €41 million this year on a like-for-like basis.
30%Creative Papers 52%
Graphic
18%Security
14%incl. Coated
46%Green
40%Specialties
Sequana • Annual Report 2016 • 53
STOCK MARKET
Market capitalisation at 31 December (in million euros)
2014 2015 2016
135
265
110
Contacts Sequana – Shareholders Relations8, rue de Seine 92517 Boulogne-Billancourt CedexFranceTel.: +33 1 58 04 22 80E-mail: [email protected]
Administration of share accounts BNP Paribas Securities Services Shareholders Relations 9, rue du Débarcadère 93500 PantinFrance Tel: +33 826 109 119
IPO of Antalis International
Sequana plans to distribute(1) approximately 18% of Antalis International share capital to its shareholders on the basis of one Antalis International share for five Sequana shares. On completion of the transaction, Sequana will remain the majority shareholder of Antalis International.The stock listing of Antalis International will associate Sequana shareholders to the expansion of the Group, a leader on its markets which has successfully demonstrated its ability to deliver strong results and to implement a diversifying strategy in the higher margin business sectors of Packaging and Visual Communication.
Sequana stock
Share data Listed on Eurolist at Euronext Paris (Segment C)Indices: CAC Small® and CAC Mid & Small® - Eligible for the “Long Only” Deferred Settlement Service (SRD Long)Ticker symbol: SEQ ISIN Code: FR0011352590Par value per share: 1 euro
Voting rights Each Sequana share carries one voting right and, since 26 June 2014, double voting rights are granted to each share registered in the name of the same holder for at least two years.
(1) Subject to shareholders’ approval at the Annual General Meeting on 6 June 2017.
15.42%Bpifrance Participations
Shareholding structure at 27 April 2017
71.10%Free float
13.48%Impala group
17.13%Bpifrance Participations
Voting rights at 27 April 2017
13.02%Impala group
69.85%Free float
54 • Sequana • Annual Report 2016
2016 2015 2014Number of shares at 31 December 65,183,351 65,183,351 51,060,304
Dividend (in euros) - (1) - -
Share price (in euros)
Highest 4.04 5.20 7.75
Lowest 1.33 2.50 2.10
Closing price 1.69 4.07 2.64
Market capitalisation at 31 December (in millions of euros)
110 265 135
(1) Decision subject to shareholders’ approval at the Annual General Meeting of 6 June 2017.
Key share data over 3 years
Share performance from 1 January 2016 to 31 March 2017Total number of shares traded per monthIn e
Monthly trading volumes CAC Small® (adjusted) Sequana (Source Euronext Paris)
Information to Shareholders
Sequana reports quarterly to the market on its key operating indicators and strategic orientations. Full or condensed financial statements are published half-yearly. All financial and stock-related data are accessible on the Group’s website www.sequana.com, in a special section dedicated to shareholders and investors. In order to simplify the users’ search for and access to information, a new version of the web site was released in 2016. A push-mail system alerts them when new press releases are published.Last but not least, the Sequana Shareholders’ Letter is published twice a year. It helps keep the shareholders informed on what is going on in the Group, and keep them abreast of new products and business successes as well as on progress made in Social and Environmental Corporate Responsibility.
SHAREHOLDER’S GUIDE
January 2016
June 2016
Nov. 2016
March 2016
August 2016
January 2017
February 2017
February 2016
July 2016
Dec. 2016
May 2016
April 2016
Oct. 2016
Sept. 2016
March 2017
12,000,000
10,000,000
8,000,000
6,000,000
4,000,000
2,000,000
0
5
4
3
2
1
0
Sequana • Annual Report 2016 • 55
Designed by
Photo credits:Photo libraries Antalis and Arjowiggins©
All rights reservedCyril Abad/Capa PicturesGeorge S. Blonsky/Capa PicturesAugustin Detienne/Capa PicturesÉric Frotier/Capa PicturesIsabelle GrosseBernhard Huber/Capa PicturesBengt Lange/Capa PicturesJulien Lutt/Capa PicturesNicole Lee/Capa PicturesBrendan Mc Neil/Capa PicturesOlivier PlacetCristel Sasso/Capa PicturesBertrand TsimbaPoster on Endometriosis: Photographer: Benni Valsson/ Model: Cécile Lancia/People
Printing:Imprimerie FRAZIER, Imprim’Vert®, FSC® and PEFC certified
This report is printed on eco-friendly paper manufactured byArjowiggins Graphic and distributed by Antalis: Cocoon Silk 350 g for the cover and 150 g for the inside pages.
is a 100%-recycled,semi-matte, extra-whitecoated paper, FSC® Recycled(FSC C021878) and EuropeanEcolabel certified (FR/011/003).
By choosing to print its annualreport on Cocoon Silk insteadof non-recycled paper, Sequanahas reduced the carbon footprintof this publication by*:
C02 2,634 kWh of energy,
C02 42,216 litres of water,
C02 155 kg of CO2, equivalent to:
a 1,549 km trip in the average European car,
1,153 kg of landfill waste,
1,874 kg of wood.
* Sources:Carbon footprint data evaluatedby Labelia Conseil in accordancewith the Bilan Carbone® methodology.Calculations are based on a comparisonbetween the recycled paper usedversus a virgin fibre paper accordingto the latest European BREF data(virgin fibre paper) available.
Printed in France in June 2017.Sequana® All rights reserved
C02
C02
C02
56 • Sequana • Annual Report 2016
AN
NU
AL
RE
PO
RT
20
16
Sequana8, rue de Seine
92100 Boulogne-Billancourt France
Tel.: +33 1 58 04 22 00www.sequana.com
Antalis 8, rue de Seine
92100 Boulogne-Billancourt France
Tel.: +33 1 58 04 21 00 www.antalis.com
Arjowiggins 32, avenue Pierre Grenier
92100 Boulogne-Billancourt France
Tel.: +33 1 57 75 92 12 www.arjowiggins.com