Company News26 October 2019
ILPRA drives growth through food safety, innovation, and packaging sector trends
ILPRA continues to expand in the packaging sector, leveraging food safety priorities, technological innovation and evolving consumer habits to drive significant growth and strengthen its market position.
Security research and food safety
Security research is a key issue. Of course, it has always been one of our focus themes, but it has increased significantly now that caution and prudence measures have been multiplied in all our activities. One of these, the first in importance, is food safety, which has a deep impact on the food packaging sector. This takes place in a positive way thanks to the growing results of companies like ILPRA.
Innovation in packaging
ILPRA is an innovative SME active in the packaging sector with a wide range of machines and technological solutions for the packaging of food, cosmetics, and medical products (this sector obviously cannot be omitted). An examination of the figures – in this case the Consolidated Half-Yearly Report dated 30 June 2020 – reveals a series of ideas that we discussed in depth with Maurizio Bertocco, Chairman and CEO of ILPRA.
Short-term and long-term trends
What emerges as clear as it is interesting is a trend that moves on a double track – short and long term. If, on the one hand, “everyone is looking for safety in the short term“, explains the CEO, “it is equally interesting to bring out a long-term trend that is destined to be a driving force for the long term”. Specifically, the reference goes to the change in spending habits recorded during the isolation period and which seems to be still going on. A practical example? “By now we go to the market on average no more than once a week,” points out Mr Bertocco, who adds: “I don’t think we will return to a daily spending pattern anytime soon”. All this leads to a very linear reflection: in the wake of changing food shopping habits, the problem of food preservation is increasingly on the agenda and, as a result, the attention – and we can also say growth – of the packaging sector is increasing.
Evidence of financial growth
We find tangible evidence of this in the comparison of revenues on an annual basis, which are not only in line with 2019, but also increasing.
"The mantra during the months when we didn’t work at full capacity, was to increase our production capacity and, at the same time, to work on reducing costs with one aim in mind: not to sell better but to produce better. Such measures have been concretized, for example, in a transaction concluded last January with the purchase of the commercial business unit of Unimec S.r.l. (which in turn is 100% controlled by ILPRA Group S.r.l.) which counts an experience, since 1994, in the field of intermediation of industrial machinery for packaging on the domestic market. An agreement to fulfill a logic of rationalisation of expenses rather than a project to increase sales. Without doubt, the increasing use of the web will also be both a long-term factor and a solid driver of cost saving."
A mix, therefore, of factors linked to a trend in the sector and others linked to internal growth and development aspects has led to:
- 6.9% growth in the value of production – now equal to €17.5 million
- EBITDA of €2.6 million (+81.2% on an annual basis)
- Even greater growth in EBIT (+158%), pre-tax profit (+183.9%), and net profit (+188.3%)
Opportunities and resilience during the pandemic
Moreover, looking ahead to the coming months, it is still the issue linked to the spread of the pandemic that plays a leading role with the awareness of the very limited impact exerted to the food packaging market and without forgetting the new business opportunities in a certain way linked to the pandemic. A few days ago, ILPRA signed an agreement with a leading manufacturer on the European market supplying machinery for the swabs production for pads and packaging machines. This has a total value of about Euro 2.3 million, exploiting its initial competitive advantage.
What do we think will happen in the coming months? “Let’s look to India” explains Mr Bertocco. “We have many requests in this area and we have no cancellations but only slippages. We are very optimistic because we are aware of the direct input of the Indian government to accelerate the action and research in food safety“.
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