Corrugated cardboard: sound budgetary strategies

Example of tenacity and industrial passion, Innova Group discloses the figures for bumper year 2014 and shows the new stages of growth. Focus on quality and lean production.

On the agenda of the annual meeting in June at the COB headquarters, Caino (BS), the data and facts relating to the previous year of the integrated paper&board converting Innova Group once again confirm the validity of the business decisions made by the Pedrotti family.
The figures speak for themselves. In consolidated terms in 2014 the turnover of Innova Group reached 65.5 million euros: hence a growth of 8% is shown compared to 2013, widely surpassing the average growth rate of the Italian corrugated board industry, standing at a much more modest 2%.
Not only that: net profits increased 82.6% over the previous year (beyond 3 million and 836 thousand euros), the cash flow reached EUR 6,714,565 (+ 34.1%) and financial expenses impacted only slightly (0.1%) on the year’s end balance.
Exports too, although inherently limited by the type of production of the industrial group, are expanding and account for 5% of sales.

A far-sighted vision
Despite the difficult economic situation, the success of Innova Group is the merited result of a precise strategy, pursued with consistency by the three Pedrotti brothers, owners and managers of the enterprise. The overall guidelines have been confirmed: constant improvement of plant productivity, competitiveness both on price as on quality, offering of a complete and extensive range, development of human capital.
Consistent with these principles, in 2014 the company made investments amounting to 2.2 million euros. The most sizeable funding was for the purchase of a new Bobst Flexo 160 Vision print machine for Imballaggi San Felice, which has enabled a further expansion of the range of products offered to the market.

Other resources have been earmarked for staff training: more than 200 employees that need to be involved, motivated and empowered, inasmuch as a decisive factor for the progress of a company as deeply rooted in the territory as Innova.     
On the management side, in 2014 a major pilot project was launched, started with the aim of optimizing activity and production efficiency: benefitting from the consultancy of the prestigious Porsche Consulting, the principles and tools of Lean Production have been implemented at Polikart (BG) and if the model is successful, it will be extended to other works of the Lombard group, these being COB, Innovacart, Ibo Ondulati and Imballaggi San Felice.

Staying the course        
Bolstered by the results obtained, the paper industry group relaunches with an even more ambitious investment plan that, given the estimates, this year is expected to reach 9 million euros. In particular, 3 million have been earmarked for the construction of new buildings at Caino, where the surface area is to be increased from 18,000 to 27,000 sqms. Clear the aim of the operation: more effective logistics activities to improve service to customers.
Additional investments, scheduled both in plant design (including the purchase still under definition of a new corrugated board converting line) both in management terms, aim to maximize the overall efficiency by consolidating both the quality of products as well as the range of packaging solutions proposed, whose variety is confirmed as an added value and distinguishing feature on the market.

Great challenges, therefore, that the group faces with confidence and determination, in spite of the weak signs of recovery and the criticalities that are certainly not lacking, from raw materials costs, penalized by the appreciation of the euro over the dollar and by the rise in recycled waste paper pulp costs.
It is therefore all the more significant that, in the first quarter of 2015, the results of Innova Group do not show any downtrends, featuring a growth in turnover of 5%, compared with a modest industry average of 0.4%. The group can also claim 128 new customers, reaching a total of 1,493 companies served, located mostly in northern Italy, Emilia Romagna and Tuscany.