For Subscribers

Get the complete article now!

TWST: It is often helpful to start the interview off with brief overview. What is Billerud’s (BILL.ST) story?

Mr. Ostlund: We were founded in the beginning of last year. It was a merger of 3 mills coming from two separate directions. One of them is Stora Enso, which is one the biggest forest industry companies in the world, probably number two. AssiDoman, the other company, used to exist - it sort of disappeared from the stock listing here in Sweden. We got two mills from that company and one mill from Stora Enso. We became a stock listed company on November 20, about one year and one week ago. We are a packaging paper company, a very niche-oriented paper packaging company. We produce up to a half million tons of kraft papers, sack papers and technical-kraft papers. We also produce up to a half million tons of containerboard and on top of that we have a surplus of pulp which we sell as market pulp. We have about 300,000 tons, 1.3 million tons in total, which is about 1 million tons of paper. So, we are obviously meeting companies is in this area. We are talking about paper, kraft paper and containerboard companies.

Mr. Lindholm: Most of our products, probably about 50 percent of our papers, are used for packaging food and beverages. So we are heavily into that sector. We are not, however, producing any packages ourselves, we deliver paper and our customers are the converters that make bags, sacks and boxes out of our paper.

Mr. Ostlund: We are not converting anything. We are pure paper producers.

TWST: Are there any new trends or developments within the industry that may lead to future growth for Billerud?

Mr. Ostlund: We are basically in food and we have a 2 percent average growth rate in our segment and that’s pretty stable. You always have some competition between paper and other kinds of materials, like plastic or whatever it could be, but I can’t see any clear trends here.

Mr. Lindholm: What we could perhaps mention is micro corrugated, which is a trend. In the old idea of corrugated boxes it was recycled boxes for transport packaging. But there has been a trend now that you make a much finer corrugated box. There is a strong trend in Europe, at least, a growing segment of micro corrugated where you have made a very fine corrugated box, which you can use for new things, let’s say replacing the much more expensive carton board, which is used to make boxes for liquor, perfume and other kinds of high-value products. That product segment is growing at 10 percent per year in Europe. We are joining this trend by extending our capacity to deliver white liner, a whole new bleached liner product. We just recently finished work on one of our paper machines to fit that. That’s also a niche-product going in line what with what Mr. Ostlund said before, that we are aiming for niche products within the paper and packaging area.