Europe
Introduction
In Europe, we have a strong focus on productivity, high output, flexibility and low waste rates. We deliver a superior cost of ownership to our customers and continue to invest in connected machines and reliability centres to further improve our operational efficiency. R&D is conducted at our Tech Centre in Linnich, Germany, which includes a consumer testing facility where we co-develop recipes and formats for new and growing categories such as plant-based milk alternatives. The region is at the forefront of sustainable packaging structures, driving demand for our aluminium-layer-free sleeves.
2022 overview
Our business in Europe continued to show solid growth in 2022 despite the return of at-home consumption to more usual levels, as more time was spent out of the home following the recovery from the COVID-19 pandemic. Volume growth was supplemented by price increases, which took effect from the second quarter onwards. In retail, many of our customers provide non-discretionary products for daily consumption, where demand remains resilient.
Performance highlights
In 2022, we placed 15 new aseptic carton filling machines with Hochwald, a leading German dairy co-operative. These machines ramped up during the course of the year and made a significant contribution to growth. Hochwald’s choice of SIG reflects a number of advantages, including a competitive total cost of ownership and a track record of efficiency and product safety. Waste rates are low, which not only improves profitability but also resonates with the increasing concern for sustainability. The flexibility of the system allows the customer to respond rapidly to changing market needs.
Entering new categories and growing our customer base
Hochwald is partnering with SIG to test our latest-generation filling machine, SIG NEO, with combivita cartons to fill plant-based milk alternatives – an example of the latest technology being deployed in a rapidly growing market segment.
Also within plant-based milk alternatives, Framptons, in the UK, launched eight brands with SIG cartons.
Traditionally our European business has been focused on litre packs, and these remain a mainstay of consumer demand. However, the roll-out of combismile in Europe has continued and is enabling us to serve demand for smaller packs, often for on-the-go consumption. Danone, which first launched combismile for flavoured waters under the Volvic brand, has expanded the offer to still water.
Furthermore, our most sustainable packs continue to gain traction. Olympia Dairy became the first company in Belgium to fill products in SIG aseptic carton packs with SIGNATURE 100 packaging material with no aluminium layer and with no fossil-based plastics. 100% of the carton packaging is linked to forest-based renewable materials. As such, SIGNATURE 100 lowers the carbon footprint of our carton packs even further.
In the Netherlands, Riedel is combining combismile with SIGNATURE FULL BARRIER, linked to forest based renewable materials, for its range of juices, and Unilever has switched to SIGNATURE FULL BARRIER for Lipton Iced Tea, in line with its commitment to a circular economy.
All our packs, including the standard structures, offer an attractive environmental profile with the lowest CO2 footprint compared with other packaging substrates. In addition, the cost competitiveness of carton is playing an increasing role in a context of higher commodity prices, with some customers considering changing from metal cans to carton for food products.
Looking ahead
Our new bag-in-box and spouted pouch substrates offer additional opportunities in Europe. Existing liquid dairy customers are excited by the expansion of our packaging range, while industrial bag-in-box opens new avenues to access processors of fresh produce in Europe.
In aseptic carton, we will continue to deploy filling machines over the coming years. This includes deployment of the first SIG NEO lines with our customers in 2023, and we expect to see continuing demand for our aluminium-layer-free carton structures.
1 At constant currency.
2 At constant currency, excluding the impacts of the Scholle IPN acquisition and adjusting for the consolidation of the former Middle East joint ventures.