SCA magazine SHAPE 2 2008

8/7/2019 SCA magazine SHAPE 2 2008

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Clean caue


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Contents N 2 2008


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Which is dirtier: a computer keyboard or a toiletseat? Do customers buy more if they movecounterclockwise through a store? The answersin Shape Up.

Poor hygiene is a big threat for industrializedcountries as well as for developing ones. In Sweden,more people die from poor hygiene than die intraffic accidents.

Russians want luxury even in the bathroom, child-ren take more time for toilet training and Europe isbetter at dealing with growing mountains of waste.

SCAs new CEO Jan Johansson and his new orga-nization will focus on growth of hygiene products.

The Canadian contora pine thrives in Swedishforests and has advantages over Swedish pines.

Shareholders left this years annual meeting withtheir own trees and Liberos spring collection isinspired by the 1970s.

Furniture made of corrugated board does morethan just save trees and lower carbon dioxide emis-sions, it is also a thing of beauty.

SCAs profits rose during the first quarter.

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keyboards had somany bacteria that there was a riskof food poisoning, according to a studyfrom University College LondonHospital. Previous surveys have shownthat offi ce keyboards contain 400times more bacteria on average thantoilet seats. The culprit in this dramais mainly computer users eating lunchin front of their computer. Particles

of food lodge in the keyboard andprovide a home for millions of bacteria.

Luxury

Did you know that you make at least10 decisions when you buy toilet paper?

For instance, should it be one-ply, two-ply, three-ply or even four-ply paper?Different packages have different num-bers of rolls, different lengths of rolls,not to mention all the different patternsthat are available. There is also a lot ofvariation between brands in terms ofquality. Most people dont want paperthats too rough, but on the other handthey dont want it so soft that it fallsapart when it gets wet, and it cant leavelint either.

Comparing three-ply paper withone-ply paper isnt relevant, says An-nette Storm Hanssen at SCA TissueEurope. Theyre two completely dif-ferent products!

The length for different toilet paperbrands varies considerably, from under20 meters to over 60 meters, so buyingsomething cheap can be expensive inthe long run.


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Most people probably know that the smellof freshly baked bread increases our desire tobuy things when were in the grocery store.But there are many other tricks to get usto consume more. For instance, purchasesof everyday goods increase if customersmove counterclockwise in a store ratherthan clockwise the explanation is that itis easier for people who are right-handed.Similarly, we buy more when there is a bluebackground rather than red, argues theresearcher and author Jens Nordflt in hisprize-winning book Marknadsfring i butik(Marketing in Stores), according to theSwedish daily Dagens Nyheter.

He also shows how large price displaysmake us think the price is low, an effect thatis pronounced if the display sign is lit withfluorescent lighting. The placement of goodsis very important, as in where on the shelf anitem is placed. Placing it at the end of a longaisle instead of the middle can increase salesby as much as 400 percent.

The Russian retail trade continues to grow, posting sales of 100

billion euros last year. The largest players in the market are now theRussian group X5, with roughly 5 percent of the market. TheGerman group Metro is second largest and has succeeded in capturingalmost 5 percent of the Russian retail market since it started upthere in 2000, according to the Russian online daily Kommersant.

Longer and heavierto save nature


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Hygiene is a major concern throughout the world,in advanced and developing countries alike.A global survey found that people everywhereworry about getting sick because of poor hygiene,but it also turned up some surprising results.

ygiene is a global issue.It is a matter of life anddeath in some places,while in other placesits more about qualityof life. To learn moreabout peoples habits

and attitudes on hygiene, SCA has donea survey in nine countries. The surveyshows that people worry the most inMexico, where nearly everyone (93percent) frets at one time or anotherabout the risk of hygiene-related ill-nesses. One-fi fth of Mexicans say its aconstant fear.

Of the countries surveyed, Swedenwas the most relaxed on issues of hy-giene and illness. Half of Swedes neverworry about the risk of hygiene-related

illness, and only 5 percent do so on a reg-ular basis. But even in Sweden, accord-ing to some calculations, more peopledie from poor hygiene than from traffi caccidents. The greatest problem here ispoor hand hygiene in healthcare.

Rough estimates indicate thatabout 10 percent of all patients admit-ted are affected by infections relatedto healthcare, says Jonas Bonnedahl,senior physician for infectious diseasesat Kalmar County Hospital in south-ern Sweden. It would have been pos-sible to avoid perhaps 20 to 30 percentof these with better hand hygiene.

in bathroomsis seen as the single greatest threat tohealth, according to the survey. After

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ALMOST ATHIRD OF ALL

CHINESE OFTENREFRAIN FROMEATING DINNERAT AN AQUAIN-TANCES HOMEBECAUSEOF HYGIENE

CONCERNS.

that come poor hand hygiene in foodpreparation, improper handling of foodand the risk of infection from contactswith other people.

People are frequently reminded towash their hands after they go to thebathroom, and a full 95 percent of re-spondents around the world say theydo. In addition, 83 percent wash theirhands before meals, although only halfof Swedes do so. In other situations,hand hygiene varies signifi cantly amongthe countries surveyed. In China andMexico it is more common for people towash their hands after handling money.In Russia, nine out of ten people washtheir hands when they come home.

Views of health risks differ in thevarious countries. Nearly eight out often Mexicans see poor hygiene in food


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preparation as one of the biggest prob-lems. Mexicans are also most likely tosee hygiene risks in not bathing or tak-ing a shower often enough. Russiansand Chinese see greater danger fromcoming into contact with animals.

hygiene affects peo-ples everyday behavior, the survey found.Virtually all those surveyed said theythink most about hygiene and cleanlinessin connection with visits to public bath-rooms. More than half of respondents,and a full 70 percent of women, try toavoid using public facilities.

Concerns about hygiene inhibit peo-ple in other situations as well. Almost athird of all Chinese often refrain from

eating dinner at an acquaintances homebecause of hygiene worries. One out ofthree Americans and Chinese shun pub-lic transportation for the same reason.

Many also consider hygiene whenthey visit restaurants, when they have totouch things in public spaces and whenthey go to swimming pools. In work-places too, there is a fear of poor hy-giene. One-third of all the people in thesurvey often worry about being infectedby their colleagues.

When it comes to personal hygiene,the most common practice is to show-er or bathe once a day. Mexicans andAustralians shower most frequently,whereas half of Chinese people showerat most twice a week.

between 10and 30 minutes on their morning ablu-tions each day, but there are major cul-tural differences. Swedes and Chineseare done in less than 10 minutes, whileMexicans like to linger in the bathroomfor more than half an hour.

Despite growing awareness of envi-ronmental and climate issues, less thanhalf of respondents said environmentalconcerns were critical in their decision tobuy personal care products like sanitarynapkins, soap and paper. Swedes andRussians give the least consideration toenvironmental aspects, while the French,Mexicans and Chinese have changedtheir behavior to the greatest extent.

When it comes to taboo topics, thereare also major cultural differences. Al-most one-fifth of the French cannotimagine discussing hair care with some-

one else, whereas only 4 percent of peo-ple globally didnt want to. In Mexico,almost half the people think it is embar-rassing to talk about foot hygiene, andin China it is considered really awkwardto talk about body hair.

There are also differences betweenthe sexes. Whereas women are moresensitive about discussing incontinencethan men, men find it harder to talkabout menstruation. Almost half themen think it is awkward to have to buysanitary napkins and tampons. Mostpeople surveyed, 85 percent, can imag-ine talking to their partner about vari-ous hygiene issues, but only 9 percent


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involving attitudes towardhygiene, is presented in the accompanying article.

Weve worked for a long time with raising thelevel of knowledge in the product categories andbrands we have, says Bodil Eriksson, senior vicepresident, corporate communications, at SCA.The surveys were now carrying out take an in-tegrated approach to hygiene based on a number

of different aspects.

Many issues related to hygiene are strictly taboo. Silence andignorance make life shorter and more diffi cult for many peoplein the world.

For SCA, which is one of the worlds biggest manufacturersof hygiene products, there are both human and business-basedreasons for calling attention to and discussing hygiene issues,Eriksson says. The results of the surveys and other initiatives inthe hygiene fi eld will be shown on SCAs website and presentedat various events.

One of SCAs aims is to increase the rate of growth in the hygienecategory. Developing countries in particular have great potential,as their use of hygiene products is still very limited and the dispos-

able income rises in many countries. Another trend that suggestsincreased use of hygiene products is aging populations.People who have moved out of poverty begin almost immedi-

ately to give priority to personal hygiene, Eriksson says. In In-dia alone, some 430 million people are leaving the poverty stage,and the trend are similar in China and South America.

In Mexico, SCA hasalready developed fem-inine sanitary protec-tion for a target groupthat is less well off.This has in part meantmaking simpler prod-ucts that can be sold ata low price, and alsomaking the productsmore easily available.The products are soldin small stands in ruralareas so that everyonecan get hold of them.In some places we sellthem in a one-pack ver-sion, Eriksson says.

SCA raises knowledgeabout hygiene


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Singapores Jack Sim wants to give status to toiletsand break the taboo of talking about pee andpoo. He founded the World Toilet Organizationseven years ago in a bid to improve globalsanitary conditions.

the World Toilet Or-ganization and its logo in the form of atoilet seat probably draw a lot of smiles.Thats fi ne with its founder, Jack Sim.He sees humor as an effective tool to getpeople to dare to talk about toilets, peeand poo. Because if youre going to dosomething about the sanitary situation,you have to be able to speak frankly.

The key to the future is raising thestatus of having good toilets, and thusthe demand for them, Sim says. Thatsmuch more effective than just informingpeople about the clear health benefi ts.

His goal is to get people to want to putmoney into good toilets in the same waythey want a TV or cellphone. Were try-ing to infl uence peoples view of toilets

in different parts of the world so that itwill be considered low status not to haveone, he says. Then there will be morepeople who give that priority.

His interest in toilets was sparkedsome 10 years ago when he read an arti-cle in which Singapores prime ministerat the time, Goh Chok Tong, said thestate of a countrys public toilets couldbe used as a measure of the countryssocial graciousness.

in Sin-gapore were in a miserable state, I de-cided to do something about it andformed the Restroom Association ofSingapore, Sim recalls. In the courseof an outreach program that involved


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cleaning up toilets in Sri Lanka, he dis-covered there were another 15 toiletorganizations in the world, but no um-brella organization. So I founded theWorld Toilet Organization in order to

gather and spread knowledge, he says.Theres an enormous need. In a worldwhere 40 percent of the populationdoesnt have access to toilets and mil-lions of people die as a result, its timewe start acting.

Since the start of his WTO in 2001, thenumber of member countries has grownto 46, and about a hundred organizationsand government authorities are involved.The group has established a college, andeach year it holds a summit in one of the

member countries to discuss issues, dem-onstrate technical and practical solutions,disseminate good examples and developconcrete plans of action. In order for thereto be any action and not just a lot of talk,we hold workshops instead of lectures,Sim says. The working groups are com-posed so that they each have all the skillsand authority to make decisions.

importance ofthe sanitary situation has increased dra-

matically, especially in Asia, he says, andthings have started to happen. In China,Beijing is investing USD 100 million tobuild 4,000 first-class toilets in time forthis summers Olympics. Its spreadto other parts of China, Sim says. InShanghai, people have started improvingthe toilets and have produced a numberof new public toilets, for taxi drivers, inshopping malls and for general use.

Another example is the Indian organi-zation Sulabh International, which hasbuilt a number of public toilets that arenow run and attended by the lower-caste Dalits. The result has been not justimproved sanitation but also a chance tobreak the caste system by giving the low-est caste improved conditions and an op-portunity to make money and send theirchildren to school. It never works justrelying on donations, Sim says. So itsa really good example of how sanitaryimprovements can take place based onbusiness principles.

To improve welfare and bring about eco-nomic development in a country, access toadequate toilets is needed. Many countrieslose substantial sums by having to wait inline each day for the small number of pub-lic toilets available or look for a secludedplace to see to their needs. The WorldHealth Organization calculates that in-vestments in improved sanitation cansave half an hour a day for people withpoor access to sanitation. For a house-hold with six people, that means 21hours a week that can instead be spentworking or studying.

Investments in improved sanitationalso yield a number of other economic re-turns. Nowadays, poor sanitation causesa number of different diarrhea diseasesin developing countries. Better sanita-tion reduces both healthcare costs andlost working hours.

For women, improved sanitation is espe-cially important. Many girls stop going toschool when they begin to menstruate be-cause they lack access to good toilets. Simi-larly, many women have to stay home fromwork during menstruation when there areno toilets.


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For shopping-crazed Russians,

the ongoing love storywith wellknown and strong

brands also includes lessglamorous areas. When Russian

consumers today choose

toilet paper, it has to have theright label on the roll.

fter decades of using the partyorgan Pravda as their closestcompanion in the bathroom,Russians are about to discov-

er a luxury that many Western consum-ers take for granted soft toilet paper.

And the roll has to have the right la-bel. For a growing number of Russians,the brand is critical, even when theychoose everyday products like toiletpaper, says Ingolf Braun, head of SCAConsumer Tissue Region East, whocontinues: People who have money buymore expensive and better brands likeour Zewa, which is viewed as a West-ern brand something that guaranteesquality in the eyes of most Russians.

The Russian market for tissue isgrowing 9 percent a year; SCAs Zewabrand is the market leader with a mar-ket share of over 30 percent market invalue. In Russia, what matters is thebrand, Braun says. Compared withmature markets in the West, the share ofdomestic brands in Russia is very low.

The region Braun is in charge of to-day falls into two segments. First arecountries such as Hungary and theCzech Republic, which are increasinglyapproaching Western patterns of con-sumption. Then come countries likeRussia and Romania, which are fartherfrom the levels of Western countries.Historically, Russians consumption of

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tissue is low, even taking into accounttheir lower purchasing power.

Today the average Russian consumes1.4 kilograms of tissue a year, comparedwith Hungary who use an average of 8 kga year. Not to mention the US, where theaverage consumption is 21 kg.

, statistics like thesedont tell the whole truth. The Russianeconomic boom, largely based on oiland gas sales, is spread very unevenly.

The growing number of middle-classRussians with money to spend are foundmainly in major cities like St. Petersburgand Moscow, or in the Russian Klon-dike towns that have grown up aroundoil and gas deposits. Tissue consumptionin Moscow is about 8 kg a year on aver-age, on par with Hungary, Braun says.

At home, the Russian delight in luxuryand status is also refl ected in the choice oftoilet paper. Compared with our othermarkets, the Russians are really fond of

different types of luxury, especially col-ored and perfumed paper, Braun says.In the arena of international politics,

Russia under Vladimir Putin has returnedto some of the nationalist thoughts of theSoviet era. But on store shelves, there iscomplete dtente when it comes to for-eign infl uences and products. I workedin China for three years before, and therewas a clear trend in favor of domesticbrands, Braun says. Thats not seen inRussia at all in the same way. But thenChinese producers for the domestic mar-ket maintain high quality.

in Russia hascreated capacity problems at times forSCA, and two years ago, an agreementwas signed to invest in a new plant inSovetsk, south of Moscow. In April2009, when the new facility reaches fullcapacity, it will have an annual capacityof 30,000 tons.

The economic boom that is driving

the sale of consumer goods also createsnew challenges for manufacturers. Fullorder books for Russian constructioncompanies are driving up costs for newinvestments.

also taking off in otherstrategically important areas. In glaringcontrast to their colleagues in westernEurope and the US, the heads of Russiantelevision are enjoying good times. Theprice of TV advertising rose 75 percentlast year, and the year before it rose 40percent, says Peter Steiner, marketingdirector of SCA Consumer Tissue Re-gion East. At the same time, TV ads areour principal channel to the consumerand are critical for the brand.

Instead of sitting back and enjoy-ing the rapid growth, both Steiner andBraun are eagerly eyeing attractivenew markets in the region. Both Ka-zakhstan and Ukraine are interestingmarkets, Braun says.


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Ready, set, go

before the advent of dis-posable diapers, children were put on the

potty as early as six months of age. In the1980s, many children were toilet trainedby the age of three. Today, children in theWestern world are usually around fourbefore they can totally manage on theirown and go without a diaper during theday. One reason for this is thought to betodays super-effi cient diapers, whichabsorb all fl uids and leave the outer layerdry. Diapers, quite simply, arent uncom-fortable enough for children themselvesto feel the need to get rid of a full diaper.

There havent been studies of howfour-year-olds, for instance, are affect-ed by having diapers, but I cant imaginethat children think its fun, says Anna-Lena Hellstrm, a urotherapist and lec-turer at Gteborg University.

is a sensitive phasethat is easily disturbed by changes inchildrens day-to-day lives.

When children start preschool, whentheir mother or father returns to work orwhen they get a new brother or sister, dia-pers can once again feel more secure thanthe potty, Hellstrm says. So it may begood not to start toilet training when ma-jor changes are going on in the family.

The question is whether there is an ide-al age for children to give up diapers. Re-searchers have yet to fi nd a specifi c toiletgene that would indicate when the timefor toilet training is most appropriate,but there are several well-supportedhypotheses. German researchers have

determined that on average childrens dia-pers stay dry during the day at 28 monthsand overnight at 33 months. But individu-al variations are considerable, and roughly20 percent of fi ve-year-olds dont have fullcontrol of bladder or bowel.

A Swedish study found that all chil-dren, even infants, are aware that theyare peeing. It was also observed thatmany children could control their blad-ders at the age of 18 months, a period thatcan thus be suitable for toilet training,according to Swedish researchers.


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he percentage of garbage thatis not recycled or burned isnow down to 5 to 10 percentin Sweden and other countries

in northern and central Europe, says

Jan-Olov Sundqvist, a waste researcherat IVL Swedish Environmental Institute.In the new EU countries and in a numberof countries in southern Europe, the pro-portion is unfortunately the reverse, andonly 5 to 10 percent is recycled.

Northern Europeans produce about500 kilograms of household waste perperson per year. In the new EU countriesthe fi gure is slightly lower because con-sumption is also lower. In many places,however, economic growth is higherthan in the West, which means that theamount of garbage is increasing. This isa problem that has already been takenup at the EU level.

There is a lot of activity under way inthe EU on waste management, Sundqvistsays. The new EU countries have been giv-en requirements to reduce dumping andincrease recycling. But Rome wasnt builtin a day. Sweden worked at it for quite awhile before we got to where we are to-day. I think waste management in Europe

will look quite different in 10 years.One reason for effi cient waste man-

agement in northern Europe is the cli-mate. There are district heating networksthat have developed in quite a different

way than elsewhere, and burning garbageis one way of heating houses. In southernEurope, the alternative is mainly produc-ing electricity. There is thus less econom-ic incentive, because of the energy lossesand the revenues arent as high.

Sundqvist believes the best way tobring about a change in behavior isthrough economic or legal sanctions,making it expensive or a crime not to sortones garbage. Information works to alimited degree, he says. To conti-nue from there, stronger incentives areneeded.

The greatest threats in waste man-agement today, Sundqvist says, comefrom things like the chemicals hiddenin building materials and the built-intechnology in cellphones. The chemi-cal industry puts different additives inplastic and paint, for example. Thatmeans that we have uncontrolled use ofhazardous chemicals that are built intocommon, everyday products, he says.

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c

Jan Johans on put

With new CEO Jan Johansson, SCA hasstepped up the tempo in the consumer goodssegment. A new organization is providingbetter conditions to take advantage of thegreat growth potential for hygiene products.

onsumer products have been lost in a for-est of goods. That, in short, is the challengefor SCAs strategy. With its widespreadperception in fi nancial markets as a forestcompany, SCA is not valued as it deserves

to be, and its growth prospects for hygiene products arenot fully getting across to the markets.

The challenge gained new force when Jan Johanssontook over as CEO in November, having said earlier thatSCA has to improve growth and profi tability. In April thisyear, SCA took the fi rst major step toward this goal whenit introduced its new organization, with the aim of placinggreater focus on growth in the companys tissue and per-sonal hygiene products.

Were introducing a global hygiene category organiza-tion, Johansson says. That means that decisions aboutwhat markets and products to concentrate on in the hy-giene category are made by the corporate senior manage-ment team. There will be a clear global strategic focus inour priorities. Thats what determines whether prioritywill be given to Denmark or China, for instance.

The new global hygiene category organization is be-ing created by concentrating resources from the differ-

ent business areas into an overall organization under themanagement of Gunnar Johansson, former head of SCAsPersonal Care business group.

With the new organization, Jan Johansson emphasizes,SCA is making clear for the fi rst time that the companysgrowth will take place primarily in the hygiene segment.The reason is clear: the growth potential for hygieneproducts is signifi cantly higher. This is especially true ingrowth economies such as Russia, China and Mexico.

Improved hygiene is something that comes early in theeconomic development of a country and a family, he says.We have to expand where the opportunities for growthare greatest. Moreover, the hygiene segment is less sensi-tive to fl uctuations in the economy. People need hygieneproducts in a recession too.

position in several areasin hygiene: baby diapers, feminine care products and in-continence products as well as tissue for consumers andaway-from-home tissue. The two brands TENA, for in-continence products, and Tork, in tissue, have revenuesof more than EUR 1 billion each, and Johansson stressesthe importance of fi nding more big sellers. Theres a


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Improved hygiene is something that comesearly in economic development.


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For consumers in stores, the environmentalaspect will become more and more important.


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clear trend that many retailers are limiting the number ofbrands, so you have to have the No. 1 or No. 2 position inthe market.

All of SCAs hygiene products have significant growthopportunities, and Johansson thinks they are greatest for

incontinence products. Were the world leader here with26 percent of the market, he says. When we enter a newcountry, we often create a brand-new market. Even in adeveloped market like Europe, theres a potential of 30percent if you look at how many people would really needincontinence protection.

Add to that the demographic changes in the West that willdrive the market for incontinence products. Today there arealmost 20 million people in the EU over the age of 80. By2050 or so, that number will rise to an estimated 50 million.

Otherwise, Johansson sees the greatest opportunities inthe growth economies. These include parts of Latin Amer-

ica, India, China and eastern Europe, especially Russia,where SCA is now expanding with its own production oftissue and personal care products. Another market I havea lot of faith in is the Middle East, a region where there ispositive economic development in many areas, he says.

At the end of 2007, SCA formed a joint-venture compa-ny to produce and sell feminine care products in the Mid-dle East and Egypt.

SCAs clear new growth focus on hygiene raises a numberof questions. For instance, will it be possible to keep up thepace in forest and packaging operations, which will havean important role in generating cash flow for the growth in

hygiene operations?

I dont see anything strange about that, Johanssonsays. In almost no other company is it only a question ofgoing full-speed in all parts of operations. Besides, its niceto generate money.

The strategy is also giving new life to the question of

SCAs structure. Why keep all the parts when there is sucha clear division between hygiene products and the otheroperations?

What speaks in favor of keeping the structure is thatthe different parts of SCA are doing as well or better thanour competitors, so theres no reason for a change in own-ership. What speaks against keeping the structure is thatSCA is not seen in financial markets as a consumer goodscompany so it winds up with the forest analysts, which af-fects the value.

about SCA is

still limited in some parts of the financial market. Ivemet people in London who know our strong brandsbut not that SCA is behind them, he says. We have tochange that.

But there are also other reasons for more closely con-necting the SCA brand with consumer goods. One of themost important is SCAs strong environmental profile.SCA was recently ranked as one of the best companies inthe world in environmental and social issues by the Britishanalyst company Innovest.

For consumers in stores, the environmental aspect willbecome more and more important, so they need to know

what the product and SCA stand for, Johansson says.


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The contorta pine is anewcomer to Swedishforests. Planting beganalmost 40 years ago,and the new source oftimber is now cominginto use in the produc-tion of sawn woodproducts as well aspulp and paper.

n the 1960s, many people wereworried about a future short-age of timber in Sweden. Thatmade forest companies starteyeing the faster-growing va-

rieties of trees found in otherparts of the world. The Cana-dian contorta pine (also called lodge-pole pine) had already been test-plantedin a number of smaller stands as earlyas the 1920s and 1930s, but demandswere growing for a more systematic in-vestment to increase total production inSwedish forests. SCA was one of the pio-neers and began growing contorta on alarge scale in the early 1970s. The seedswere carefully selected to fi t the Swedishclimate.

Most of the pine was planted fromthe late 1970s to the mid-1980s, sayske Westberg, project director at SCAForest Products. Then the trend easedup a bit, but SCA has continued to plantit every year, and we will continue to doso in the future.

term, contorta can pro-vide major increases in production. Itgrows 40 percent faster than Swedish

pine, and it has been shown to with-stand damage from moose and fungusattacks. So more contorta pine surviveto maturity compared with Swedishpine, Westberg notes.

So far, though, the contorta stands inSwedish forests have not advanced thatfar. In about 30 years, at the earliest, theoldest plantings will be ready for har-vesting. But thinning has already start-ed in earnest, and that provides a sig-nifi cant source of new timber. About200,000 cubic meters of contorta tim-ber are now coming out each year fromthinning in our forests, Westberg says.And the fi gure will rise toward a half-million within a decade.

timber haslargely been used for the manufacture ofCTMP, or chemo-thermomechanicalpulp, the basis of liquidboard material.

Thats where contorta has uniqueproperties, Westberg says. The boardgets bulky, which means you can reducethe weight and keep the thickness. Thishas been used for things like milk car-tons, where you want a lot of fl exiblerigidity so that the packages keep their


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shape even when they are stacked on topof one another. At the same time, youwant the weight as low as possible.

He explains how the unique propertiesof contorta are due to the fi bers looking

different than in Swedish pine. The ad-vantages have also been made apparentin plant tests with bleached sulfate pulp,which is used for producing tissue for pa-per towels, toilet paper and the like. Thecontorta fi ber provides a high degree ofstrength even when there is little energyused in paper production, which contrib-utes to its useful product qualities.

as well, thisnewcomer to Swedish forests has shownthat it has come into its own. The thickerlogs will be used for sawing into timberand further processing, such as glulam,interior panels and other visible woodproducts. Weve also investigated theproperties of the wood in impregna-tion and painting, Westberg says. Andweve concluded that contorta has thesame areas of use as both regular pineand spruce.

In some cases, contorta has even turnedout to have better properties than Swed-

ish varieties of trees. Because it growsquickly, there is more space between theannual rings, which gives it a differentstructure, and there is also more spacebetween each ring of branches, which

provides advantages when producingknot-free products.Nowadays, people usually dont

want to have any knots in windowframes and other products. So the knotsare cut away and the ends glued to-gether, Westberg says. If theres a lotof space between the knots, the resultsfrom sawing will be better because lessmaterial will be lost.

it will take 10 to 20years before the contorta trees are bigenough for sawing. Westberg is con-vinced that the Canadian pine will takeon an ever growing role in paper andpulp plants as well as sawmills. TodaySCA has about 280,000 hectares ofcontorta planted, which is almost halfthe total area of contorta in Sweden.On our own land the target is to have20 percent of the surface we harvesteach year replanted with contorta,Westberg says.

On our ownland the target

is to have 20percent of the

surface weharvest each

year replantedwith contorta.


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light rain fell on share-

holders as they madetheir way to SCAs An-nual General Meeting

on a Tuesday afternoon in April. In ac-cordance with tradition, the meetingwas held on the campus of StockholmUniversity. Inside the Aula Magnalecture hall, nearly 400 participantswere greeted with birdsong and springfl owers.

Shareholders were eager to hearwhat the new CEO, Jan Johansson,

had to say. He told how he started hiscareer at SCA 38 years ago in the formof a summer job in Sundsvall. He alsonoted the improvement in earnings,largely the result of higher prices.

Both Sverker Martin-Lf, Chair-man of the Board, and Johanssonmentioned the Procter & Gambletransaction as one of the most impor-tant events of 2007.

Johansson also talked about sus-tainable development, telling share-holders that after the meeting theywould receive a tiny spruce tree, whichthey were encouraged to take homeand plant. That was one way of doingones share in reducing carbon emis-sions, as growing spruce absorb morecarbon dioxide than mature forests.

The audience was told to be carefulabout keeping the plant indoors, as itcan grow up to 25 meters tall.

The new CEOs speech and a spruce to take homewere two memorable features of SCAs Annual GeneralMeeting on April 8.

a


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1. When did you become a shareholder?

2. Why are you attending the Annual General Meeting?3. What do you think the share will do?

The new equipment on the stretchsides machine at Swanson, NewZealand, is able to produce stretchsides on Treasures Ultra diapers. Treas-ures was recently launched in the NewZealand market in Crawler, Walker,Toddler and Junior sizes, and itsstretch sides are proving a popularfeature in nappy design.

Barrie McDermott, manager engi-neering, said the new equipmentensures that Treasures product develop-ment is able to better respond to world-wide trends.

Globally, there is a signifi cant move-ment towards a stretch diaper, he says.

Drypers Newborn, the fi rst dispos-

able diaper product for newbornbabies in the economy segment, wasrecently launched in Singapore,Malaysia and Thailand.

Drypers Newborn was speciallydeveloped for care of newbornbabies sensitive skin, focused onoverall softness and comfort. Withthe launch last year of both DrypersNewborn and Drypers XXL alarger diaper for bigger babies, withstronger absorption capacity Dry-

pers now offers consumers inSoutheast Asia a complete diaperrange that meets babies needs atevery stage of growth.


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diaperis more like regular underwear,such as panties or underpants. Thespring collection includes six differ-ent patterns that recall the fashionsof the 1970s with creative fi gures

and shapes.My design style is the same,

whether Im designing clothes ordiapers, Kling says. One of mybest friends, who just had a baby,was my sounding board. She likesthe diaper patterns, and I hopetheyll appeal to other young, fash-ion conscious parents.

She describes her patterns as be-

longing to a make-believe worldwhere different fi gures meet. Shetells how she was inspired in part byher collection of miniature objects,plastic fi gures and Japanese toys.

The diapers have the same fi t and

quality as other Libero Up&Go dia-pers, and the price is also the same.

Last year, the entire productionsold out quickly. The specially de-signed Up&Go diapers will be soldin the Nordic countries, the Balticstates and Hungary. Linus Clausen,head of Nordic marketing for Libe-ro, says he expects the diapers to besold out by the second half of June.

Libero is repeating last years hit with a speciallydesigned diaper. This years collection was designed bythe young Swedish designer Karolina Kling. As withlast year, the diapers are being sold in a limited edition.


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SCAs graphic paper mill in Laakir-chen has launched a new paper,Grapho Verde, with 50 percent recy-cled fi bre. The paper is a result of theincreased environmental awareness.We have launched a paper grade,Grapho Verde, with high content of

Grapho Verde meets demand for moreenvironmentally friendly paper

de-inked pulp, says Mark Lunabba,mill manager at SCA Laakirchen inAustria. As a result of the favorabledemand for this paper and our posi-tive experiences of using a high pro-portion of recovered paper, we nowneed to increase our capacity for de-

inked pulp. The Laakirchen facilityinvests EUR 10 million to increasethe percentage of recycled fi bre in itsproducts. The aim is to reduce the useof pulp-wood raw material, energyconsumption and thus the carbon di-oxide emissions without compromis-ing the high quality of the print re-sults. GraphoVerde is an uncoatedpaper used for printing magazines,catalogues and supplements.

The 2nd Global Forum on In-continence (GFI), an internationalplatform for debate and sharedinsight into incontinence, met inNice, France, this April. The event isthe second such meeting supportedby SCA and its brand TENA. Themeeting gathered together over 250politicians, health administrators,care providers and patient groups.

Their shared goal was to address theintricate issues involved in balancinghealth economics with the quality oflife for patients and their care givers.

There is a growing concern thatthe political will, funding provision,access to services, and clinical bestpractice relating to incontinence issuesare potentially failing patients, saidProfessor Ian Milsom of the Sahlg-renska Academy at the University ofGothenburg, Sweden, and chairman

of the GFI.The clear consensus was that theissue needs to be higher on the health-care agenda. Speakers gave examplesfrom several countries where multi-disciplinary and more sensitive ap-proaches to incontinence reduced thestress, inconvenience and prejudicesfaced by those suffering the condition.


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corrugatedboard is cheeky, bold and fashionable and it comes in large part from recycledpaper. Every ton of paper thats recycledsaves 17 trees, 4,200 kilowatt hours ofelectricity and 7,000 liters of water. And

more importantly, carbon dioxide emis-sions in the atmosphere are reduced.

Sergei Gerasimenko came to Sweden in1990 from Odessa in what was then theSoviet Union, today Ukraine. Two yearslater, he began designing and producingfurniture made of corrugated board.

The sofas in ReturDesigns premisesin Stockholms Kungsholmen districtare stable and surprisingly beautiful.The furnitures appearance varies morethan you might think.

One armchair is made of cardboardwith a barrier layer, which gives it abeautiful luster. Another is upholsteredin gray fabric. A third is painted red.Cube-shaped stools have dots on theirsides to resemble giant dice. There are

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also bookshelves, chairs and tables, allmade of corrugated board.

For me, it was almost criminal not tomake furniture that is degradable, Gerasi-menko says. Making furniture that lasts athousand years, when we humans have a hun-dred at most, is sick. And all this in a societywhere everyone redecorates and gets new fur-niture every fi ve years or even sooner.

People dont understand what harmtheyre doing to nature when they changetheir furniture, buy goods from the otherside of the globe or throw bandages downthe drain. Were destroying our planet at aterrible rate.

About 40 percent of the corrugated boardused in the furniture comes from recycledpaper. Long fresh fi bers are needed on thesurfaces to make the cardboard strongerand fi rmer so it can be folded. Fibers fromrecycled paper are broken down and caneasily crumble into pieces.


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ReturDesigns main niche is interiorsfor trade fairs and exhibitions.

Then corrugated board is unbeatable,he says. The furniture is easy to trans-

port because of its light weight, easy to setup, and it can quickly be dismantled.Gerasimenko designs all the furni-

ture, which can be custom-ordered. Ifsomeone has ordered a bookshelf twometers tall, he might ask if its OK tomake it eight centimeters higher or twocentimeters shorter so the material canbe used optimally.

The strangest thing is a casket madeof corrugated board, a piece Gerasi-menko doesnt like to handle but stillmakes on order.

He tries to make all the furnitureso that it can be folded or dismantledto be shipped more cheaply, minim-izing the environmental impact by usingfl at packages.

When its time is up, the furniture issent to the paper recycling station, inkeeping with the times.

Corrugated board is durable andecologically sustainable, Gerasimenkosays.


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Profi t rose to SEK 1,9 billion SCAincreased its profi t during the fi rst quar-ter this year despite rising prices for raw

materials. Behind the increase in profi tare better earnings in Tissue and Per-sonal Care operations.

SCA had profi t before tax of SEK1,946 million for the fi rst three monthsof the year, compared to profi t of SEK1,863 million for the same period lastyear. At the same time, sales increasedto 27,513 million, compared to SEK25,615 million.

The SCA Group increased net salesby 7 percent, driven by acquisitions

and favorable sales development, espe-cially in emerging markets, where salesgrowth was 14 percent. These factors,

along with an improved product mix,contributed to 8 percent growth in oper-ating profi t, says CEO Jan Johansson.

The improvement in profi t for theGroup came despite higher costs for rawmaterials and energy. The Tissue busi-ness area increased its operating profi tby a full 61 percent as a result of acquisi-tions and price increases. Personal Careincreased its operating income by 10percent due to higher volume and a bet-ter product mix.

, how-ever, higher costs for raw materials and

energy resulted in a 5 percent decreasein its operating profi t, excluding the di-vestment of its North American packa-

ging operations. Earnings for the ForestProducts business area were on par withthose for the preceding year.

In the Q1 report, corporate se-nior management team noted that theeconomy has weakened in the US and insome segments in Europe in the wake offi nancial uncertainties, which makes itdiffi cult to compensate in every segmentfor price increases for raw materials.However, tissue and personal care prod-ucts are relatively insensitive to fl uctua-tions in the economy.

Its been a good start to the yearfor most of our operations. For Pack-

aging, however, the costs increased bythe end of the period, which affectedthe profit in a negative way.


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going to happen.

T E N A U l t i m a t e P a d s p r o v i d e o u t s t a n d i n g p r o t e c t i o n . T h e y f e a t u r e a

m u l t i - i n l e t t o p s h e e t t h a t a b s o r b s l i q u i d q u i c k l y t o h e l p k e e p y o u d r y

an d comfor table . An d l ike a l l TE N A pr oducts , th ey ar e specia l ly des ign ed

with micr o-beads in s ide th e pad to quick ly lock in l iquid an d f igh t odour .

F l l f

Documents

SCA magazine SHAPE 2 2008