PL
Integrated
Report 2021

Market environment

Internal and external factors affecting the operations and development perspectives of the Company and the Capital Group

In 2021 the consolidated sales revenue of the Capital Group of Grupa Kęty S.A. amounted to PLN 4.6 billion (growth by +30 y/y), out of which 50% originated from foreign sales. The Group products are exported mainly to the European countries; only 4% of foreign sales are made on markets outside Europe, chiefly in the USA. The sales revenue is diversified among 4,500 customers, whereas the share of none of the customers exceeds 5% of the consolidated sales. Products are used by cutting-edge sectors with the highest development potential, such as construction or automotive businesses, road transport, railway, electrical engineering, household goods and packaging sectors.

The sales structure exposes the Group companies to trends fluctuations occurring both in the Polish economy and in the economies of other European countries. Therefore, all factors affecting the economic situation in the construction business (availability of loans, level of investments), the automotive and transport sector (number of vehicles sold, share of aluminium elements in the vehicles) as well as the food sector (consumption and type of packaging applied by food manufacturers) have a significant effect on the sales of the Capital Group.

PLN 4.6
billion
consolidated sales revenue in 2021
50
%
share of foreign sales in revenue

Foreign sales

In 2021, foreign sales were developing fast, practically in all directions. The fastest development pace was recorded in the European countries outside of the EU (mainly the UK and Ukraine), with over 100% growth of sales. In the EU countries 17% growth was recorded, while in the domestic market the growth reached 28%.

Analysing the product sales structure, a significant 43% share of the Aluminium Systems Segment may be observed (façade systems, door-and-window systems, as well as external aluminium roller shutters), the sales of which is realised mainly in the construction business.

In 2021, owing to the growing volumes and aluminium prices, the share of the Extruded Products Segment Sales in the total sales of the Capital Group grew by 3%. The Segment manufactures aluminium profiles, pipes and bars for customers in many sectors, however, the leading share belongs to the construction, transport and automotive industries.

The Flexible Packaging Segment recorded a share close to that of the preceding year. The Segment offers its products mainly to the food sector (plastic laminates and films, either printed or not printed).

Read also:

Market environment

Extruded Products Segment

Since the 1990s, a steady increase in competition has been observed due to the attractiveness of the Polish market and the vicinity of the markets of Central and Eastern Europe. Companies take measures aimed at the expansion of their production capacities or their product offer. Moreover, products from Far and Middle East are sold on the European markets.

The Polish aluminium industry is currently on very high level. The production of extruded products has been growing from year to year; plants invest in modern technologies and extend their production capacities. In Poland there are 9 press shops, availing of the total of 40 presses to extrude aluminium profiles. This places our country among the top European leaders in manufacturing extruded products.

According to estimates, the production capacity of aluminium profiles extrusion in Poland reaches the total of about 345,000 tons a year, out of which 96,000 in the Extruded Products Segment. The extrusion capacity of the Segment puts it at the top position among the domestic press shops, and within the top ten of the largest profiles manufacturers in Europe.

International concerns are active in Poland in the aluminium processing industry, such as for example: Hydro Aluminium, Aliplast, and Cortizo Kaye Aluminium, but also smaller press shops of domestic origin, including: Extral Aluminium, Final (Grupa Yawal), Eurometal, Albatros.

Aluminium Systems Segment

Aluprof SA – the leading company of the Segment, is one of the major manufacturers of aluminium systems for the construction business in the world, and one of the most innovative companies in that sector of industry. Aluprof supplies aluminium systems for the production of windows, doors, façades and sun protection solutions, which apart from the high level of functionality and aesthetics comply with strict safety requirements and are characterised with fire-protection features. The company portfolio includes also individual architectural systems, and solutions for energy-saving and passive buildings. The share in the market of aluminium systems for the production of windows, doors and façades in Poland reaches 42%, and 60% as regards roller-shutter systems. Aluprof S.A. has 5 plants in Poland and 9 divisions in Europe and in the USA. The main competitors in the particular business segments, with their manufacturing plants in Europe, are: Sapa Building System, Schuco, Ponzio, Yawal, Aliplast, Blyweert, Heroal, Alukon, and Reynaers.

The market of packaging in Poland is one of the fastest developing sectors of economy and the fastest growing packaging market in the European Union. It is the effect of the presence of large concerns as well as major investments carried out in the recent years. All major international concerns are active in Poland, including: Amcor, Mondi, Constantia, Huhtamaki, and Schur Flexibles, as well as many small and medium-sized companies of Polish origin, such as: KB Folie, Drukpol, Supravis Group, Marpol, Ergis, and Bogucki Folie.

Read also:

Flexible Packaging Segment

The long-term strategy for the Flexible Packaging Segment has been prepared in the period of major transformations on the packaging market, where expectations have been changing dynamically as a result of ecological pressures, focus on cost reduction and food safety, as well as legislative changes. The strive for sustainable development is forced by the necessity of creating and marketing new forms of laminates, i.e. mono-structures characterised with lower weight and higher materials homogeneity. Despite the observed pressure on plastic packaging and replacing them, where possible, with packaging based on refined paper, the position of the former seems not to be threatened, as flexible, plastic-film-based packaging protect packed food as no other packaging, extending the food shelf-life. The FPS is well prepared for operation in such market environment and has been gradually improving its position on the BOPP films market in the region, as well as building brand on the foreign markets by way of active establishing of new business relations.

The sector of packaging in the whole European Union has been currently coping with many problems – mainly materials sourcing. The problems mostly originate from broken delivery chains and strong demand, which result in price increases. These refer to practically all raw materials for the production of packaging intended for food industry. Further, there are additional costs of abiding by the new legal regulations, which result from the implementation of the European environmental policy and the circular economy model. Higher prices of materials, higher environmental awareness of the consumers, as well as new legal regulations put the packaging segments in face of big challenges and huge investments, if the companies wish to remain on the fast-changing market.

Selected results
Extruded Products Segment