Start-up of production at a new facility at Kansas City / USA in August is the key project in 2006 for the Weidenhammer Packaging Group (Hockenheim / Germany; www.weidenhammer.de). Production will begin in rented premises. However, managing director Ralf Weidenhammer said the group will consider building its own facilities in "two to three years." The US plant, the ninth worldwide for packaging manufacturer with 750 employees, will produce large folding drums for ice cream, made of cardboard with a retaining ring in PP.

The European leader in rigid composite cans of cardboard with an internal coating of aluminium film or – less frequently, plastic film – on a tinplate base has Reported good figures for 2005. Sales rose to EUR 129m from EUR 117m in 2004 and are estimated to ease forward to EUR 130m in 2006. Without giving figures, the group said earnings last year were satisfactory. Margins were higher, although profit per product fell.

The low sales growth last year is attributed to the loss of EUR 12m in revenue following a European Court of Justice ruling that closes a tax loophole for packaged cigarettes to be self-assembled. Without this effect, sales would be EUR 13m higher in 2006 compared with 2005, Weidenhammer said. Nevertheless, management is confident of winning back a third of the lost business in 2007 with packaging for other tobacco products. Plans also call for increasing the equity ratio from currently 30% to 36%.

In 2005, Weidenhammer reported capital spending of EUR 13m, with EUR 3.5m spent at corporate headquarters. Preparations are currently underway for moving the former GRT Verpackungen aus Kunststoff, now Weidenhammer Plastic Packaging from Groitzsch / Germany acquired out of insolvency retroactive to April 2005, into a new production facility at nearby Zwenkau. The investment volume is to remain steady or increase slightly in 2006. Some EUR 2m is earmarked for the new US production.

The German group´s inclusion of plastic cans in its range is proving successful, the managing director said. The target market here is primarily the "wet food" sector that takes in packaging for meat, delicatessen salads and ice cream. However, Weidenhammer has no plans to enter the mass market for thermoformed products. The group produces for the most part highly decorated packaging, with full-surface printing or in-mould labelling (IML).

Injection moulded plastic packaging, including that still produced at Groitzsch, currently accounts for around 9% of group sales. Prior to the acquisition of GRT, Weidenhammer produced plastic lids at Hockenheim, as well as Malines / Belgium and Montanay / France. Altogether, the group processes around 5,000 t of plastics annually, 70% PP-based, the rest PE-based and the share of plastics is set to rise further. Some 20% of the EUR 205m sales the group targets by 2010 will be plastics-related. The expanded Zwenkau site is expected to generate sales of EUR 12-15m. Weidenhammer is also planning further acquisitions. The takeover of another medium-sized firm had been planned for 2005, but negotiations did not proceed as rapidly as hoped.

Weidenhammer claims to have a market share of 70% in composite cans in Germany, and a share of 39% in Europe. Its strongest competitor is US packaging group Sonoco Products (Europe: Zaventem / Belgium; www.sonoco.com) with market shares of 12% (Germany) and 24% (Europe). This company is by far the market leader in the US, with a share of 95%.