Choose topics to filter the report

Your filter results

EMEA

Core revenue

€798m

2019: €755m

Growth at constant currency

+5.6%

Introduction

SIG’s aseptic carton packaging business originated in Germany, and our largest sleeve production plant globally is in Linnich, where we also assemble filling machines and conduct R&D and consumer trials.

Our presence in the Middle East and Africa has until now been through a 50/50 joint venture, SIG Combibloc Obeikan. The joint venture’s sales are not consolidated, but our share of net income is recognised in the Group income statement. On 25 November 2020, SIG announced its intention to acquire the 50 percent of the joint venture which it does not already own. Upon completion, the transaction will lead to full consolidation of the Middle East and Africa business.

2020 overview

Responding rapidly to increased orders in Europe

Europe is a relatively mature market with a high level of per capita milk consumption. Our go-to-market strategy is based on winning new customers and growing with existing customers by offering flexible and cost-efficient solutions. We are also entering into and growing in new categories.

In 2020, our business saw an unexpected tailwind arising from the COVID-19 crisis. As lockdowns were imposed across Europe in March, consumers stocked up on shelf-stable goods such as those filled by SIG. The growth in demand for carton packs accelerated in the second quarter as at-home consumption increased, with households eating more meals together and consuming more beverages at home. At the same time, customers and retailers built stocks in order to avoid a repeat of the shortages that occurred during the early days of the crisis. While these stocks were partly drawn down in the second half of the year, a further wave of lockdowns resulted in demand remaining at a high level.

A large portion of our business in Europe consists of litre packs which are suited for at-home consumption. But it was not just the product range that met customers’ needs. The teams at our factories worked tirelessly to meet the high level of demand, and in April our factories recorded an all-time production record. We also overcame the many logistical challenges caused by the crisis to ensure that we achieved on-time delivery and a high level of customer satisfaction.

Capitalising on growth opportunities in Middle East and Africa

SIG Combibloc Obeikan’s geographic territory spans 70 countries in Middle East and Africa (MEA), with revenue currently generated in 17 countries. Growth potential comes from the young and growing populations in countries where GDP per capita is on the rise, and it is further driven by urbanisation and disposable income growth. Changing lifestyles and consumption habits favour processed and packaged food, an area where our aseptic carton packaging solutions play an important role. As household incomes remain low in many countries, the ability to provide affordable solutions is also a key success factor.

Performance highlights

Meeting customer needs in Europe

In 2020, we further strengthened our presence with leading customers such as Arla, which use our packs not only for the European market but also to export milk to Asia. Arla has a strong sustainability positioning in Europe, which is perfectly complemented by our aluminium-free structures EcoPlus and SIGNATURE.

At the same time, our drive to win new customers continued and we fully leveraged the versatility of our portfolio and our recent innovations.

We expanded our presence in the fast-growing category of plant-based milks. We signed a contract with MONA, which is part of the Hain Celestial Group and one of the largest co-packers and producers. The first filling machine was placed towards the end of the year and now produces one-litre packs of rice, soy, almond and coconut milk, featuring our novel fully resealable and leak-proof combiMaxx closure. In France, Tribillat has adopted SIG’s technology for its flavoured soy drinks, also with combiMaxx.

Gabriel Bean, Founder of GROUNDED (photo)

“Just one small idea can change an entire industry, and we identified a gap in the market for a clean, genuinely natural, plant-based shake.”

Gabriel Bean

Founder of GROUNDED

The London-based company GROUNDED has partnered with SIG to turn its innovative concept for a 100% natural range of plant-based protein shakes, aimed at health-conscious mobile consumers, into a commercial reality. The shakes were first produced at combiLab, SIG’s consumer testing centre in Germany, and will subsequently be filled by the co-packer Framptons.

Gabriel Bean, founder of GROUNDED: “Just one small idea can change an entire industry, and we identified a gap in the market for a clean, genuinely natural, plant-based shake – with no compromises on natural ingredients and packaging. We spent more than six months sourcing the right packaging that aligned with our values, and we found the perfect fit in SIG’s combidome. Its sustainability story and unique shape make it the perfect option for our range. Beyond the carton, the team and people at SIG were just as aligned with our values, and we couldn’t have found a better partnership with which to launch these products. They supported us all the way from our first contact with their UK team through to their exceptional combiLab operation in Germany. We look forward to continuing our partnership here with such professionals in their field.”

Woman holding oat drinks (photo)
Finnish food producer Juustoportti has launched a new range of premium oat-based drinks in SIG’s combismile carton packaging.

Our combismile cartons made their European début in Finland with a launch by Finnish food producer Juustoportti. Juustoportti has launched a new range of premium oat-based drinks – Friendly Viking’s Oat Drinks – which will help to develop the on-the-go market. The range has two drinking options – a single-action closure or a paper straw – with a drinksplus option to allow the addition of healthy ingredients such as fruits or oats.

And the future looks very promising. In April, we announced that Hochwald, a leading German dairy cooperative, has chosen SIG as its preferred partner for a new dairy production site. We will supply 15 of the 16 new filling machines for the plant, which will have a capacity of more than 800 million litres of milk a year. The plant is scheduled to come on-stream in 2022.

Liquid dairy wins in MEA

In 2020, SIG Combibloc Obeikan continued its strategic focus on liquid dairy, which represents a cheap and easily accessible form of protein for consumers with limited purchasing power. Over 60% of the joint venture’s sales are now in liquid dairy, compared to less than half five years ago.

Mazoon Dairy, the largest integrated dairy company in the Sultanate of Oman, chose SIG Combibloc Obeikan for the launch of a full range of liquid dairy products in various sizes and formats. Mazoon Dairy will also use SIG packs for juices. Other dairy-related successes included a further expansion of business with Almarai in Saudi Arabia, Zaki Group in Iraq and Tchin Lait in Algeria, as well as a partnership with Al Jaied in Libya to launch the first evaporated milk in aseptic carton packaging.

After a successful transition to SIG filling lines, Soummam in Algeria was able to launch new formats and sizes to enter new product categories, including cream, enriched milk, blended milk and flavoured milk for children, as well as food products such as béchamel sauce.