Austrian packaging processor makes phoenix-like recovery

Reorientation of the product line has led this film processor out of the doldrums and toward a bright future—even in a high-wage EU country.

Manfred Schlapps, board member and COO of Unterland Flexible Packaging (Langkampfen/Kufstein, Austria), says the 49-year-old processor’s future producing trash and freezer bags in today’s competitive climate would not have lasted long. Following financial constraints resulting from decisions made by previous owners, the company has bounced back with the help of Berlin-based Capital Management Partners (CP-M), a turnaround equity firm that came in three years ago to help breathe new life into the operation.

Since then, €26 million has been invested in the latest equipment, the staff has been beefed up to a total of 400, and management dropped commodity film products to concentrate on value-added specialties. Unterland has a leg up on producing such products over low-cost producers due to its pool of know-how, Schlapps says.

Today the company specializes mainly in coextruded technical polyolefin films produced for more than 1000 customers on 37 extrusion lines, a mix of blown-film and cast-film equipment from familiar names such as Windmöller & Hölscher (Lengerich, Germany), Reifenhäuser (Troisdorf, Germany), Davis-Standard (Erkrath, Germany), and Wintec Winding Technology (Reichenburg, Switzerland). Since 2004 the company has seen turnover rise to an expected €146 million/yr in 2007 and sales that have increased by 10% since 2006.

Although not Europe’s largest film processor, it is the largest (90,000 tonnes/yr) producer of technical web under one roof. Unterland is also Europe’s first certified class 8 cleanroom film processing operation that produces the company’s Clean Cast polypropylene (PP) films. Total capacity is up to 18,000 tonnes/yr. Class 8 permits contamination of less than 29,300 particles of a maximum size of 5 µm/m³ of room air compared to a normal office, which is loaded with several million particles.

“Our customers are more demanding today than ever before. They don’t want to deal with mistakes in film products and will send an entire shipment back rather than accept less than top quality,” Schlapps says. The operation has 1000 active recipes for its different customers. To maintain this level of quality Schlapp says the company has had to look for the best technology on the market as it will have to function reliably around the clock, 365 days a year.

Equipment investments

One of the equipment decisions was a GDS7 Senior gravimetric blending systems from FDM (Königswinter, Germany) for installation on all equipment that did not already have dosing equipment pre-installed at delivery. FDM has supplied 38 loss-in-weight units that can deliver a total of seven components with a throughput of 1500 kg/hr of pellets, masterbatches, or additives, says Guido Faust, managing director at FDM. “Exactness in recipe is key to quality production,” says Michael Janisch, operating engineering manager at Unterland. “Of course there is a cost-saving effect, too, from the more precise dosing that one gets compared to volumetric systems.” The entire gravimetric dosing system includes more than 3500m of feed pipes and controls.

Unterland also saw the need for investing in optical inspection systems to ensure web quality before it left the plant. So far it has installed four SMASH optical inspection systems from ISRA Surface Vision (Herten, Germany) to check transparent and translucent film for pharmaceutical, medical, and food packaging produced in cleanroom conditions.

“Optical inspection is a necessity for us, a building block we use to tell our customers the product they receive is free of errors, or we can tell them where on the roll the problem is and they can simply pass over that,” says Schlapps.

With its four ISRA systems installed in 2006, three on cast-film lines and one on a winder slitting machine, Unterland is looking not only at the size of errors and location but also actual visualization of such things as bubbles, holes, gels, fisheyes, and black specs. Janisch says customers indicate what types, sizes, and color of defects they will accept in the finished product and Unterland sets inspection parameters to document these.

“Some customers may be able to live with a bubble to a certain size or a gel to a defined length if it isn’t a certain color,” says Janisch. “Others will say they tolerate only a certain number of defects in a defined square-meter area.” Producers of lamination film often have extremely high requirements on the number of defects allowable, says Martin Lehmköster, key account manager at ISRA Vision.

On the horizon

The outlook for the company is outstanding, says Schlapps who is predicting that by 2010 the company’s turnover will have climbed up to €250 million/yr. Export plays a big role with 82% going mainly to EU customers, but some highly technical films are being sold to both the U.S. and China. So far, five-layer coextrusion is the limit, but Schlapps says Unterland is considering going to seven layers to offer customers more diversity in product.

According to Schlapps, production is running flat-out at present, which will necessitate further investments and perhaps an expanded location to allow the company to reach its output goals. The future lies with globally active Mondi Packaging, which acquired Unterland for €74 million soon after MPW visited the processor.