Business area Tissue

Challenging year 

The Tissue business area comprises the subsidiary Rexcell Tissue & Airlaid AB, which produces tissue and airlaid. Approximately one half of production is sold to external customers, primarily for the manufacture of hygiene products, while the remainder is used within Duni.

Tissue and airlaid constitute the basis for Duni's production of table top products, such as napkins and table covers, as well as hygiene products. The term ‘airlaid’ refers to air laid tissue, while ‘tissue’ refers to wet laid tissue. Production plants are located in Skåpafors and Dals Långed in Dalsland. These paper mills are relatively small and specialized in the production and deep dyeing of high-quality tissue and airlaid.

Development during 2010

In 2010, net sales within Tissue fell by 8.2%, to SEK 499 (543) m. Operating income increased to SEK 18 (16) m. The operating margin was 3.7% (3.0%).

The beginning of the year saw the start of production of a new generation of hygiene products. As a consequence of the change, the hygiene product mix has become more complex and start-up of the new products entailed major costs.

Pulp prices rose sharply during the year. Due to the time lag in the pricing model, it was not possible to compensate in full for the increased costs, a factor which had a negative impact on income. However, capacity utilization normalized compared with last year, leading to positive effects which mitigated the consequences of the high cost level for input materials.  

Events during 2010

In June, a fire broke out at the airlaid line in Dals Långed, resulting in water and smoke damage in the several critical parts of the operation. The damage led to a loss of approximately two months' production. The fire had only a marginal impact on income since insurance compensated for most of the damage.

During 2009 and 2010, Duni invested SEK 58 m in a new biofuel boiler. The biofuel boiler was brought into commission in August 2010, resulting in lower and more foreseeable energy costs, together with a reduction in the use of fossil fuel. The boiler is fired primarily using forestry waste products together with waste from the mill's own manufacturing process. Consequently, waste from the mill's own production can be used for energy recycling instead of being dumped; this represents a significant and positive step for safeguarding the environment.

A biofuel boiler was brought into commission in 2010

Table top products and hygiene products

Duni’s own tissue production meets most of the Group’s needs for the manufacture of paper-based table top products. Tissue is produced in various qualities and processed into various materials, such as Dunicel ^® and Dunisilk ^® . Dunicel ^® is a robust material which is suitable for the production of table top products and has a feel which resembles cotton and linen table covers. Dunisilk ^® is a material which is used for table covers and has been produced to protect the table and can be wiped off after use. Production of airlaid meets Duni’s own needs for the production of napkins. The unique premium material, Dunilin ^® , has incredibly good absorption quality combined with a very soft feel.

Customers and external sales

The Tissue business area’s customers consist mainly of converting companies within table top products and leading companies within the hygiene products industry. Approximately one-half of the total production value of tissue and airlaid is used for processing within Duni, while the remainder is sold to external customers. 

Within the airlaid product category, most of the production is sold externally as an input material, primarily to a small number of manufacturers of hygiene products. Customer relations are long term and based on close cooperation, which also covers product development work.

 

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Duni has two paper mills in Sweden.