content
Letter to the shareholders In memoriam Our profile – our business
P. 04 P. 06 P. 09
OUR MISSION, STRATEGY AND FUTURE
Our Business statement Our Company slogan Our Core values – Our Strengths Our Commitments Our Areas of expertise Our Future focus
THE SIOEN GROUP
Vertical Integration Diversification Innovation Research and Development Health and Safety Environment Quality Human resources Sioen in the world
THE SIOEN DIVISIONS
Coating division Chemicals division Apparel division Industrial applications division
P. 12 P. 13 P. 14 P. 15 P. 16 P. 17
P. P. P. P. P. P. P. P. P.
20 21 22 22 27 28 29 30 32
P. P. P. P.
36 44 49 54
SHAREHOLDERS
Report of the Board of Directors Group Structure Share information Corporate Governance General Information
PART II - P. 08 PART II - P. 11 PART II - P. 12 PART II - P. 14 PART II - P. 19
FINANCIAL OVERVIEW
PART II - P. 23
ADDRESSES
PART II - P. 90
DEFINITIONS
PART II - P. 92
introduction # 03
letter to the shareholders Dear Shareholder, Despite all the speculation and all the ink spilled on the subject, the fact remains that 2009 was a crisis year. It was all hands on deck. In every area. The drop in demand was sharper and deeper than anyone had expected. In our 2008 letter to the shareholders we already spoke of restructuring and temporary unemployment. In 2009 they became essential tools in steering a course through this crisis situation.
Resistance and resilience While the sales of the apparel division resisted well to the economic crisis, the other divisions were more heavily hit by the slowdown of the global industry in general. 2009 therefore was a year to show resistance and resilience as our main strengths. Sioen is a resistant company, combative and tenacious in overcoming difficult situations. In 2009 we faced the crisis and looked for weapons to overcome it. We are also a resilient company and went hunting for fresh ideas for change. We kept morale high in our teams, accepted the difficulties, searched for solutions, and reinterpreted the situation that confronted us.
In the spirit of the master Because our company had yet another setback to overcome: the loss of the founder and inspirer of Sioen Industries as we know it today. Jean-Jacques Sioen died on 20 November at the age of 73. Together with his wife and his three daughters he built up the company into a thriving multinational. On page 06 of the first part of this annual report we honour the man to whom our company owes its name and its vision. 04 # SIOEN annual report 2009
The way we handled the situation in 2009 and the way that, united, we look to the future, is how Jean-Jacques Sioen would have wanted it: strong and with confidence.
2009: The figures‌ Sioen Industries has decided to put the focus for future development on its core activities and, as a consequence, to discontinue a group of non-core activities. More specifically the manufacturing activity of finished truck tarpaulins, the manufacturing activity of dashboardfoils in small volumes and the extrusion of technical foils on small width are determined as non-core activities or discontinued operations, as described in the annual report. Sioen Industries will now focus on the core activities within the divisions coating, apparel, chemicals and industrial applications or the so-called continued operations, as described in the annual report. Some key figures for the year are: > Net sales related to the continuing operations amounts to EUR 251.9 million compared to EUR 316.4 million in 2008. > Gross margin of the continuing operations remains at the same level as 2008. > Cost saving activities in 2009 were successful and mainly consist of: - cost reduction of general costs: EUR 13 million, - cost reduction of personnel costs as a result of technical unemployment programs and part-time labor: EUR 3 million. > Profit related to the continuing operations: EUR 3.2 million. > Loss related to the discontinued operations: EUR 14.3 million, including impairments amounting to EUR 6.4 million. > Net cash flow of the Group from operating activities: EUR 61.5 million. > Decrease of net financial debt position: EUR 42.8 million. > Cash & cash equivalents: EUR 30.2 million
... and not just figures
for today and tomorrow
The crisis is not just about figures. It is also about opportunities. Not just about savings but also about innovation.
We are facing the current uncertainties of the economy and we do not expect a quick recovery.
Of course we focused heavily on reduction of costs and working capital needs while respecting our employees, partners and customers.
We therefore will continue to make every effort to conquer new markets through innovation and by strengthening our commercial efforts. Reducing cost levels and further debt reduction also remain high priorities.
But we are also analyzing how we can improve the performance of our operations and how we can optimize processes and make them more efficient. Our R&D department was never as productive as in 2009. Our sales teams are motivated as never before.
We are convinced that, with the support of our shareholders and thanks to the skills of our highly motivated personnel, we can look to the future with confidence. Thank you for your trust in us.
We are ready... When economy recovers, we shall be set to advance with existing, updated and also brand new products, ready for the market. Like our newly-developed technical textiles for drinking water bags, for crash barriers, for soil consolidation and drainage basins. New products are to come such as ultra-high tech yarns, new pigments for the retail market, new and sophisticated protective clothing and many others, strengthening potential growth in all divisions.
Michele Sioen CEO Sioen Industries n.v.
Our compagny slogan ‘protection through innovation’ are not just hollow words. You will find more details about R&D at Sioen Industries on page 22 of the first part of this annual report.
introduction # 05
IN MEMORIAM
Jean-Jacques Sioen was a passionate and dedicated entrepreneur. In 1960, when hardly anybody heard of the word technical textiles, he founded Sioen Industries. He specialised in this ‘new’ and promising niche and built a first small coating line in BeverenRoeselare (Belgium). In 1967 Jean-Jacques’ wife Jacqueline Sioen started an apparel workshop in Roeselare, using Sioen coated textiles. Together they built up a success story where their daughters play an important part today. The philosophy of Mister Sioen has always been a pragmatic one: be better, faster and more innovative in all activities he deployed. From that point of view grew the company adagio: ‘protection through innovation’. In the 70s and 80s the company continued to grow, despite the oil crisis and economic slowdown. Soon the two buildings at Beveren and one at Roeselare became too small and they moved to a single new site at Ardooie, the current headquarters of the company. Standing still is going backwards was one of his favourite expressions. The company expanded export and acquired production sites abroad. In 1989 Jean-Jacques Sioen received the export award from Prince Albert.
06 # SIOEN annual report 2009
But also misfortunes came along. How Sioen overcame these problems shows the strength and the power of Jean-Jacques Sioen and his family. In 1991 a fire destroyed the Ardooie plant. This set-back gave a new elan to the company. Driven by Jean-Jacques and Jacqueline Sioen the company inaugurated a brand new state-of-the art production plant in Ardooie (Belgium), went public with an IPO and was awarded ‘Company of the year’. Loyal to his own words ‘protection through innovation’ the company continued to invest permanently in new applications, markets, products, new processes and techniques. After 45 years as CEO of the company, Mister Sioen passed the presidency of the company in 2005 and became chairman of the Board of Directors. Everything Mister Jean-Jacques Sioen did, he did wholeheartedly. Sadly we are parting from a wise man, a visionary entrepreneur and the inspiration of Sioen Industries.
introduction # 07
'Vertical integration diversification and permanent growth'
08 # SIOEN annual report 2009
our profile Sioen Industries is a diversified stock quoted group with an extensive portfolio of products and activities: spinning, weaving and coating, manufacturing of clothing, production of fine chemicals and processing of technical textiles. Vertical and horizontal integration, diversification and permanent growth have driven us since 1960.
our business Sioen Industries is: > The world leader in coated technical textiles > Strong specialisation in high end technical apparel > Specialist in fine chemicals > Global player in the processing of technical textiles
introduction # 09
SIOEN MISSION STRATEGY AND FUTURE
Sioen mission, strategy and future # 11
OUR BUSINESS STATEMENT
We will continuously optimise the conversion of > chemicals > customised technical fabrics > foil sheets through our unique and cost effective vertically integrated process capabilities, up to and including > the transformation into finished products. We will focus on global B-to-B customers and professional users in order to assure continuity, risk-spreading and profitable growth for all our stakeholders. We will do the above in a dynamic environment, through flexible and quick response to the market, focussed R&D efforts and a global sales and production presence. In addition, we will develop environmental friendly coating and converting technologies to set a winning standard for primarily green safety and protective products to create sustainable profitable growth.
12 # SIOEN annual report 2009
Our company 'Protection slogan through innovation'
'We will develop environmental friendly coating and converting technologies to set a winning standard for primarily green safety and protective products.'
Sioen mission, strategy and future # 13
Our core values All Sioen companies have as their core values integrity, fairness, honesty and respect in all aspects of their business. Sioen Industries expects the same from all its stokeholders.
Our strengths > Vertical integration, making us independent of outside suppliers, giving us a major technical advantage and better R&D. > Technical expertise. Sioen products predominate where technical specifications are decisive. > A ‘hands-on’, unbureaucratic corporate culture.
14 # SIOEN annual report 2009
'Integrity, fairness, honesty and respect' Our commitments
Commitment to our customers We have to provide our customers with high quality products and services at competitive prices. We have to meet our customers’ demands and win and maintain customers’ trust.
Commitment to our employees We have to offer our employees an attractive working environment where there is room for personal development, creativity, responsibility, and career opportunities.
Commitment to the company’s shareholders. We have to protect their investment and every year provide them with an acceptable return.
Commitment to our business partners We have to build partnerships and mutual beneficial relationships with our suppliers and contractors.
Commitment to society Sioen companies work in a wide variety of changing social, political and economical environments. We have to conduct business responsibly by observing the laws, supporting human rights, respecting the environment and by creating additional jobs.
Sample of Sioen technical clothing Sioen mission, strategy and future # 15
Our areas of expertise R&D We must excel at R&D collaboration across the entire organisation in order to benefit from and optimise the knowledge/expertise and to develop new profitable growth products/solutions and process cost savings.
Production engineering We must excel at continuous improvement of our production processes and know-how to keep and make them state-of-the-art, cost effective and flexible and to achieve the right quality requirements.
Market intelligence We must excel at detecting and understanding current and future market needs in order to develop customised solutions and bring them timely (faster than competition) to the market.
Global growth coordination We must excel at integrating and coordinating our sales force and production investments in order to maximise their effectiveness for the group and to avoid overlap or wasted resources.
16 # SIOEN annual report 2009
Our Future focus If we want to realise our goals and live up to our business statement, we must decide what our focus will be regarding the products we offer, the customer and end-users and the geographic areas we want to cover.
Our future product offering We will focus on: > customised products > high end, specialised products > recyclable/recycled products > integrated features > intelligent textiles
Our customer/end-user profiles We will focus on:
'We have to conduct business responsably'
> partnerships > new sales channels > niche specialists in technical markets > administration and tenders
Our future geographic areas We will expand our sales to: > North America > STAN-countries > India
Sioen mission, strategy and future # 17
the SIOEN group
the Sioen group # 19
Vertical integration As a fully integrated group, Sioen covers every stage of the production and conversion of coated textiles, from spinning to weaving to coating and on to specialist processing. This includes all five main coating processes, each with its own applications and markets.
BASE MATERIAL >
1. Spinning of polyester high-tenacity yarns
2. Weaving of the yarn into various base textiles
COATING STAGE >
FINISHING >
4. Application of coatings, using five different technologies (direct coating, transfer coating, online coating, extrusion coating, calendering)
5. Coated fabrics sold as semi-finished products to external manufacturers
3. Preparation of colourings (pigment pastes, varnishes, inks and dyes) = Sioen Chemicals
6. Apparel Division - Production of protective clothing for industrial and leisure use
7. Industrial Applications Division – Processing of heavy-duty coated textiles for specialist markets
20 # SIOEN annual report 2009
diversification Sioen products play an important part in our daily lives, protecting us and our goods and generally improving our quality of life. Throughout the years we have established a wide range of products through internal development of new products and markets, acquisitions and licensing of new technologies. This diversification allowed us to spread the risk, create growth, exploit our know-how and use the available resources and capacities more efficiently. Sioen provides, amongst others, filters to treat the water we drink, side curtains on trucks, publicity banners, mattress covers and protective clothing for medics, fire fighters, police forces, soldiers and pilots. Sioen products strengthen our roads, improve the safety and comfort of the cars we drive, and allow us to enjoy outdoor sports in all weathers.
'Sioen products play an important part in our daily lives' the Sioen group # 21
Close up weaving loom
Innovation Innovation starts from a constant desire to be out front, exploring new territories, striking out in new directions. It is spurred on by competition: if we don’t innovate, others will. It requires us to be entrepreneurial and take calculated risks. ‘Protection through Innovation’ is Sioen’s corporate slogan. Innovation keeps us ahead of the market with new products, processes and applications based on our core expertise.
Research & Development Sioen has a concerted focus on knowledge, innovation and creativity: on new materials, new production processes, new services, new niches, new markets and new requirements. Knowledge is our fundamental principle and our real capital. Sioen organizes its research and development activities around three main areas: product development, process improvement and technological innovations. The products we develop must both meet customer expectations and create added value for the business. Process optimization made possible by technological innovation is making a substantial contribution to the group’s effectiveness.
22 # SIOEN annual report 2009
Recent R&D realisation sioseen
Integration of light into coated fabrics Light plays an important role in our lives. In 2009 Sioen started a development project on the integration of light into coated textiles. Application areas are tents and textile architectures, trailer covers, banners, etc. In 2009 the R&D team showed the feasibility of different concepts. In 2010 we will further develop this field in collaboration with world leading partners.
'Sioen has a concerted focus on knowledge, innovation and creativity'
the Sioen group # 23
A ‘spider’s web’ R&D structure Keeping ahead of the market requires ongoing investment in research and development. At the group’s central R&D centre at its headquarters in Ardooie, professionals work on product development and innovation and on process improvement with state-of-the-art facilities. 51 people are involved in R&D and testing. Innovation is a state of mind in all departments of the group: production, sales, marketing, R&D, quality, management,... Direct expenditure on R&D and testing amounted in 2009 to 5.0 million EUR (=2.0% of turnover), related to contuing operations, including production time and related costs. As well as its central R&D unit, Sioen has other research teams at major production sites, conducting specific research and product testing in more restricted areas. Work done at the production sites is coordinated and managed from the central R&D unit in Ardooie.
'Keeping ahead of the market requires ongoing investment in research and development'
Sioen’s R&D team cooperates closely with national and international research institutions, universities and scientific institutes in Belgium and abroad. This includes a special working relationship with the Textile and Textile Engineering department of the University of Ghent, and IWT-projects.
Recent R&D realisation flexible tanks Food contact materials such as drinking water containers (flexitanks) should be safe and should not transfer their components into the foodstuff in unacceptable quantities. European Directive 2002/72/EC and its amendments are council directives published by the European Commission regulating plastic materials and articles intended to come into contact with foodstuffs (including drinking water). In 2009 Sioen put significant R&D capacity in the development of a PVC coated polyester quality that is complies with European legislation for food contact materials. This compliancy means that all ingredients of this coating material are listed on the European positive lists for food contact materials, and that global and individual migration limits as well as smell and taste limits are respected. We expect that compliancy tests will be finished in Q1 2010. 24 # SIOEN annual report 2009
Recent R&D realisation photovoltaire cells In 2009 Sioen started the development of PV-integrated coated textiles. First priority was the development of PV-integrated tent and textile architectural (TA) materials. Therefore we have studied numerous combinations of PV laminates, substrates and adhesives that can be applied for long term usage. Sioen is now finalizing the R&D phase by building large demonstrators in collaboration with tent manufacturers. Besides tents and TA Sioen is also developing PV products for roofing applications. In February 2010 we will open a prototype area in front of the new showroom for coating products in Ardooie, showing this application.
'Innovation keeps us ahead of the market with new products, processes and applications based on our core expertise'
the Sioen group # 25
Top flight test facilities Sioen’s R&D centres and labs are fully equipped with the latest testing equipment. Testing for tear and breaking strength, flame retardancy, thermal radiation, chemical resistance, bullet and knife impact, water column, colour fastness, ageing and so on are all performed in-house, and Sioen can stand comparison with the world’s top research institutes in this area.
> Test for limited flame spread
The fabrics of the suit are exposed to an intense radiant heat.
A horizontal flame of 25 mm is pointed on a vertical fabric for 10 seconds.
> Test of exposure to heat radiation
> Test for limited flame spread EN533 EN533 aims to prevent that the wearer gets extra injuries due to the burning of his clothing.
> Ballistics laboratory
> Test for convective heat
This test simulates the fire fighter being entrapped by flames; he must fight his way through the flames.
26 # SIOEN annual report 2009
> R&D lab for technical coated textiles
'Safety is a core value and safe behaviour is encouraged and respected'
Health and safety
All our companies have a sustainable approach to health and safety. To this end, Sioen companies manage these matters as a critical business activity. Safety is a core value and safe behaviour is encouraged and respected in all Sioen companies.
Our goals are: > To eliminate work-related injury and illness. > To provide work environments that do not compromise the health or safety of each individual. > To ensure that this politics is applied throughout the whole organisation.
the Sioen group # 27
Environment As a responsible corporate citizen, the group complies with all legal requirements. As a market leader it also seeks to operate a proactive environmental policy, investing every year to protect people, nature and the environment, applying stricter standards than those required by law. For Sioen, care for the environment is a constant concern.
Recycling In our business statement we say: “We will develop environmental friendly coating and converting technologies to set a winning standard for primarily green safety and protective products to create sustainable profitable growth.� Therefore, in addition to developing new products, technologies and processes, the R&D team is also intensively engaged in researching and developing recycling options. Possibilities include the recycling of used technical textiles in bags, insulation materials, mud flaps and so on.
Environment-friendly production and energy recovery The group is making increasing use of recycling and energy recovery technologies. Coating sites are fitted with distillation and combustion towers, which minimize exhausts and recover hot air which can be used to pre-heat ovens. At Ardooie, contaminated solvents from cleaning paste tubs are distilled for re-use and we use heat exchangers.
Electricity generation The new extension at Ardooie (Veranneman production hall plus storage warehouse) is fitted with electricity generating solar panels.
'Sioen operates a proactive environmental policy'
28 # SIOEN annual report 2009
Quality At Sioen Industries the customer and customer satisfaction take centre stage. This calls for an approach in which the quality of the finished products and services provided must meet the customer’s highest demands. Sioen Industries therefore does not confine itself to just checking the end product, but implements an efficient quality policy to ensure appropriate monitoring throughout the entire production and sales process. We demand a constant level of quality from all our suppliers and employ the necessary specialists to carry out permanent monitoring on the shop floor and random sample checks. Here, Sioen Industries makes use of the latest communication and IT applications.
'Quality is not confined to those departments which come into direct contact with the customer'
However, Sioen Industries has not only been concerned with the quality of its products. Careful attention is also being given to superior working conditions. Creation of a stimulating working climate, in which everyone gets the chance to develop their abilities, is one of the keystones of the policy.
on all levels Quality means satisfying the customer‘s expectations in terms of products and delivered services. Quality is not confined to those departments which come into direct contact with the customer. It is a key principle for all employees of the Sioen Industries group as they perform their work, whether in production, sales, accounting, customer service, R&D or purchasing. Every employee contributes to quality in their own field.
the Sioen group # 29
Certificates The Apparel Division has met ISO 9001 standards since 1996 and now complies with the most recent ISO 9001 version 2000 regulations. It also works according to the AQAP-120 standards for military tenders. Thanks to a constant concern for quality’ the Coating division was one of the first coaters to acquire the ISO 9001 certificate. The five areas of focus for the ISO 9001 standard – quality management system, management responsibility, management of resources, production of the product, and measurement, analysis and improvement – form the core of Sioen’s integrated quality assurance system.
Human resources The human capital at Sioen Industries is an important link in the expansion of the company. Our employees help make sure that promises are kept and that our products and services meet customers’ expectations and demands. Through many years of dedication, our employees have built up a huge fund of skills. They put their heart and soul into their work, constantly offering creative solutions and alternatives.
Sioen seeks to create a stimulating working climate in which those who want can develop their capacities to the full. Sioen has always practiced open communication. This keeps us in tune with people’s wishes, aspirations and needs. Vacancies are filled internally wherever possible. Employees are encouraged to train further. Through our various works councils we try to communicate openly and in a spirit of confidence with personnel representatives. Consultation meetings and additional discussions are held when major topics come up. Our flat company structure makes it easier to listen to people. New ideas, initiatives or grievances are quickly aired. Sioen’s activities fall into two major sectors, textiles and chemicals. Since the big crisis in the textiles sector a generation ago, the sector still battled with a negative image. This is unfair, as today’s textiles companies are technically advanced, research-driven enterprises. Many, including Sioen, are profitable and expanding.
30 # SIOEN annual report 2009
Personnel per country 2009 Total: 4 237
personnel per division 2009
1% 8% 2 278
2500
chemicals 13% coating
2000
Apparel GROUP
1500
industrial applications
25 15 1
25
16
38
15 6
212
500
149
633
824
74%
1000
4%
Belgium China Germany France Ireland Indonesia Netherlands Poland Portugal Tunisia UK Ukraine USA
0
'Sioen seeks to create a stimulating working climate in which those who want can develop their capacities' the Sioen group # 31
sioen in the world
21 22 16 18 10 12
20
11
19
32 # SIOEN annual report 2009
1 ARDOOIE
Sioen Coating Division /
Apparel Division / Veranneman TT /
Sioen Coating Distribution
2 BORNEM
European Masterbatch (EMB)
Fillink Technologies
3
KERKSKEN
TIS
4 LIEGE
Sioen Nordifa
5 MESLIN - L’EVÊQUE
Inducolor
6 MOUSCRON
Sioen Fibres - distribution/spinning
Sioen Fabrics - weaving, coating
and calendering
7 POPERINGE
Coatex
8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23
Sioen Shanghai - SHANGHAI - CHINA Saint Frères - Enduction & Confection - FLIXECOURT - FRANCE Richard Colorants - LOMME - FRANCE Sioen France - NARBONNE - FRANCE Pennel Automotive - ROUBAIX - FRANCE P.T. Sungintex - BEKASI BARAT MARUNDA - INDONESIA P.T. Sioen Indonesia - JAKARTA - INDONESIA Donegal Protective Clothing - DONEGAL - IRELAND Roltrans Group Polska - KONIN - POLAND Siofab - SANTO TIRSO - PORTUGAL Roland International - TEGELEN - THE NEDERLANDS Sioen Tunesie - CTS - Sioen Zaghouan - TUNIS - TUNISIA Roland Ukraine - RIVNE - OEKRAINE Roland Tilts UK - BRADFORD - UK Mullion Manufacturing Ltd. - SCUNTHORPE - UK Roltrans Group America - TEXAS - USA
13 23
14
the Sioen group # 33
Sioen Coating division Spinning, weaving Coating: 5 coating techniques Main product markets Competitive position Geographical markets, sales organisation
P. 36 P. 38 P. 39 P. 40 P. 41
Sioen Chemicals division
Pigment pastes, inks, varnishes, colour powders and dispersions Main product markets and competitive position Geographical markets, sales organisation, R&D driven
Sioen Apparel division
Introduction Main product markets Niche markets Production sites
Sioen Industrial Applications
Our activities Our markets Geographical markets and sales organisation
P. 43 P. 46 P. 47
P. 48 P. 49 P. 50 P. 54
P. 55 P. 56 P. 59
the SIOEN divisions
the Sioen divisions # 35
Coating Division In this division, vertical integration takes centre-stage. This means that Sioen handles the entire production process of spinning, weaving, pigmenting and coating.
36 # SIOEN annual report 2009
Spinning
CONVEYOR Adhesive Active Finish enhances the rubber adhesion properties.
GEOTEXTILE High Tenacity, high modulus and low creep properties keeping soil and rock in their place.
OFFSHORE MOORING Marine finish application. High strength to weight ratios Abrasion resistance to increase durability and life expectancy.
COATED FABRICS High Tenacity High Shrinkage (eg sailcloth) and Low Shrinkage (eg tarps) maximising fabric width and flatness after coating.
Sioen has one of the most modern spinning mills in the world (Mouscron - Belgium), where every year approx. 16,000 tons of polyester granules are processed into high tenacity yarns. A portion of the yarns is twisted in the twisting plant; the rest goes directly to our weaving mills. In addition, we spin an increasing number of custom made yarns for external customers.
NARROW FABRICS Slings, wraps,… good tensile strength with variety of elongations.
ROPES & HOSES Adhesive Active Finish enhances the rubber adhesion properties High strength to weight ratio’s.
Weaving The yarn is supplied as raw material to the three weaving mills (Mouscron, Ardooie, Kerksken- Belgium). Each weaving mill has its own specialisation: sailcloth, open structure textiles, high tenacity textiles used as base material for coating, airbag textiles, protective fabrics for body armour and forestry, … The fabrics all meet high technical requirements for tensile strength and tear resistance, limited flame spread and light fastness. the Sioen divisions # 37
Coating Coating is covering (PVC, PU, silicone or other) a substrate (nylon, polypropylene, polyester, polyamide, cotton, wool, woven or non-woven fabrics or sheets), to enhance and alter the physical properties and appearance. The end result is a technical textile with properties such as chemical resistance, anti-stain, vapour and gas resistance, electrical conductivity, water resistance, abrasion resistance, anti-static, printability and fire resistance. Sioen Industries applies five main coating processes, on eight coating lines (5 in Belgium, 2 in France and 1 in Portugal).
'Sioen Industries applies five main coating processes, on eight coating lines'
Preparation of coating layer/colouring The coating layer can consist of PVC, polyurethane, silicone or other polymers, which are sourced from major chemicals companies. Sioen produces its own pigment pastes for colouring the coating layer (See also Sioen Chemicals division p. 44-48). Pastes are mixed in fully automatic paste kitchens and then brought to the coating line by robots.
38 # SIOEN annual report 2009
5 coating techniques
Direct coating: The PVC coating paste is directly applied to the fabric in four layers. Applications: curtains, tilts and tarpaulins for trucks, railway wagons and containers and other uses, sports mats, swimming pool covers, textile architecture, publicity banners,…
Transfer coating: The coating paste (PU, silicone, etc.) is applied to the fabric via a paper support. Applications: protective clothing, outdoor sports clothing, shoe protectors, mattress protectors, airbags,…
Online coating: Here the open weave fabric passes directly from the loom into a coating bath. Applications: geogrids, swimming pool covers, reinforcement nets, windbreak nets, filters,…
Extrusion coating: The granules (different polymers) are extruded and rolled on a carrier (textiles, non-woven, knitted fabrics, paper, …). Applications: ventilation tubes, pond liners, greenhouse foil, sewer renovation,…
Calendering (rolling): We make TPO (thermoplastic polyolefin) and PVC films that are embossed to give the required aspect (can be motife/texture). Applications: car dashboards, door panels, sun visors, wall coverings, pond liners,…
the Sioen divisions # 39
PRODUCT MARKETS AND COMPETITIVE POSITION More than half of the total production of the coating division is sold as semi-finished products to external customers (distributors and manufacturers) for use in the areas given below. The remaining part is used internally as base material in one of the other divisions of the group. 60% of the market is shared among one major German coater and various smaller and increasingly specialized (by product or by region) competitors in Austria, France, Germany, Italy, Scandinavia and Spain amongst others, certain of whom go opportunistically in and out of markets from one year to the next. Sioen accounts for over 40% of all European coating capacity. Drastic fallback of traditional markets such as transportation, automotive and sign due to the economic crisis forced and enabled us to focus more and more intensively on new, developing markets such as sports, textile architecture and bio-energy.
Transportation - Tarpaulins and side curtains (direct and extrusion coating): The market for PVC coated tarpaulins and side curtains for trucks and railway wagons are the most important segments (accounting for around 40% of external turnover of the direct coating. The remaining 60% is divided amongst the other markets). This market, for both new and replacement tarpaulins and side curtains, is mainly located in Western Europe, where the large trailer builders are situated. The use of coated fabrics has not yet become customary in the American market, where trailers are usually hard-bodied. Sioen and one other German competitor dominate this market. In 2009, there was a general decline in the transportation market. This had immediate effect on the Sioen turnover. Our market share was not affected.
Geotextiles and roofing (online coating): Technical open structure textiles are used as reinforcement netting for roads, roofs and all types of plates. With approximately 60% of the market Sioen is the market leader in this segment. Geotextiles (around 20 Mm² worldwide) is a steadily expanding market, although also suffered in 2009.
Transportation - Automotive (direct coating, transfer coating, calendering): TPO and PVC films and technical textiles for car interiors (dashboards, door panels, sun visors, gear lever protection, seat backs, trunk covers etc.) and airbags. The new calendering facility enables Sioen to be more flexible and to expand its geographical market. However, since mid 2008, this automotive market has been under enormous pressure.
40 # SIOEN annual report 2009
Flexible, breathable technical textiles (transfer coating): These are mainly used for protective clothing and mattress covers. With its modern production system, large runs, R&D and know-how and the advantages of vertical integration, Sioen can compete in this competition-sensitive market (Asia).
Swimming pool covers and liners (direct coating, extrusion coating): Sioen is by far the largest global supplier of technical textiles for this segment. The greater proportion of the turnover comes from France, where several swimming pool cover and liner producers are located.
Sign (direct, extrusion and online coating): Sign is the collective name for printable technical textiles that are used for publicity banners. Although competition of low cost –lower quality laminates from Asia is high, Sioen has a solid brand name with high quality banner material. We sell a substantial part of products of this segment in Asia. Bilboards (sign) is the second largest application in the Western European heavy coated fabrics market (estimate: 45 Mm²). Sioen has a market share of about 10%.
Textile architecture (direct, extrusion and online coating): Textile architecture covers technical textiles for tents and structures. As a fully integrated coater, we fine-tuned and dedicated our machinery in 2008 in such a way that we are now capable of producing high quality textile architecture membranes. We coat the back and front side in one run, immediately followed by a special lacquering treatment, providing a better overall tension of the membrane. Textile architecture (20 Mm²) is one of the fastest-growing markets for coated textiles worldwide. Entry barriers are the high technical characteristics of the product and the stringent guarantee requirements. One competitor operates exclusively in this market and has a significant market share. Sioen has expanded in this market in 2009 and will further do so in the following years.
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PRODUCT MARKETS AND COMPETITIVE POSITION
Sports (direct, online, extrusion and transfer coating): We developed and marketed a brand new range of phthalate free membranes for sports mats and children playgrounds. This industrial chemical can be harmful when swallowed, absorbed or inhaled. The Sioen phthalate free range is childproof and environmental friendly.
Bio-energy/ Agriculture (direct coating): Sioen developed a new and high tech range of membranes for biogas containers and manure holders. We produce membranes for covers, liners and bags, all according to very technical specs and requirements. Silo’s can contain all kinds of waste such as abattoir trash, manure, organic and vegetable waste, grease, ‌
Niche markets (direct, extrusion, online, transfer and calendering coating): Apart from these 7 major markets, Sioen also produces technical textiles, films and sheets for rolling doors, bouncing castles, boat covers, machine protection, oil booms, ventilation tubes, sewer liners, bird nets, wall coverings, bags, pond liners. Each product has its typical high technical requirements. Depending on the type of product, Sioen dominates the market or is a smaller player. The volumes of these specific niche markets are small compared to the other main segments. The complex technical nature and thus the high added value of these products allow bigger margins. We will continue to focus on these kinds of products.
42 # SIOEN annual report 2009
Geographical markets Over 80% of the Coating Division’s turnover comes from the traditional Western European countries, led by France, Germany, the Benelux and Great Britain. Eastern Europe and Asia are increasingly important markets. The geographical distribution reflects the location of final producers. Several large trailer manufacturers are based in Germany and the UK, Germany has a rich tradition of using geotextiles, France has a large number of swimming pool cover and mattress cover makers. The largest digital printing works are based in Western Europe and Pennel Automotive has a long history of contacts with French car producers. Technical textiles for digital printing, truck curtains and tarpaulins are also finding their way to Eastern European customers.
Sales organisation In addition to the permanent sales staff operating out of the Ardooie, Mouscron, Roubaix and Portugese plants, and a number of local agents, the Coating division has its own sales offices in Germany, France and China.
geographical spread 2009
geographical spread 2008
18%
18%
12%
20%
4%
15%
4%
8%
14%
5%
7% 7%
5%
7%
10%
7% 21%
16% Germany
Great Britain
Germany
Great Britain
France
Italy
France
Italy
Belgium
Scandinavia
Belgium
Scandinavia
Eastern Europe
Other
Eastern Europe
Other
Netherlands
Netherlands
the Sioen divisions # 43
chemicals Division Sioen Chemicals produces pigment pastes, inks, varnishes, colour powders and colour dispersions at two locations in Belgium and one in France.
44 # SIOEN annual report 2009
The Product Pigment pastes are used for colouring polyurethane and PVC coatings, epoxies, acrylic resins and silicones. These find their way into a huge range of end products, including vinyl flooring, wall coverings, silicone kits used in construction and interior decoration, kitchen sponges, mattress and furniture liners, shoe soles, bathtubs, sanitary facilities and luxury yachts. Sioen Chemicals also produces specific flame retardant pastes. It is one of the only manufacturers in the world of high tech pastes that render textile invisible to military infrared cameras.
Inks Sioen Chemicals produces water-based, solvent-based and UV inks for wide and super wide format digital printing and decorative inks.
'Sioen produces pigment pastes, inks, varnishes, colour powders and colour dispersions' the Sioen divisions # 45
Varnishes Sioen Chemicals offers a wide range of water and solvent borne and UV-curable varnishes and lacquers. Applications include liquid varnishes for printing inks, top coat varnishes protecting decorative surfaces, and specific technical products such as inhibitor varnish for special patterns in decorative applications.
Colour powders and colour dispersions These are used to dye paint, plaster, wax, cement,‌
'The chemicals division is a niche specialist, focussing on very technical and special custom made products'
46 # SIOEN annual report 2009
Main product markets About 87% of production is sold to external customers. The other 13% is used internally as base materials in the coating division.
The Chemicals division is a niche specialist, focussing on very technical and special custom made products. There are 4 major groups for colour pastes (PVC, PU, Silicone, Aqua): > Transportation (tarpaulins) > Automotive > Sealants > Coating There are 4 major application areas for our decorative inks: > Wallpaper > Decorative flooring > Decoration paper > R&F PVC The inks for wide and super-wide format digital printing are used mainly for banners and billboards. The colour powders and dispersions are bottled from 30 ml to 250 ml for colouring paints, clay, concrete, chalk, fillers, ‌ for do-it-yourselves and professional users. The market for colour pastes (both coatings and colour pigments for painting) has decreased under the influence of a lower demand from the (technical) textile sector. Decorative inks continue to perform well and we are seeing a rise in volume here.
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Competitive position Sioen Chemical’s organisation’ and the fact of having the Sioen group as its largest customer, gives a scale advantage over the relatively fragmented competition. In addition, the personalized service and close partnerships with the customers play an important role in the success of this division.
Cost advantage Vertical integration of production processes yields products that are used as raw materials in coating and varnishing. This allows effective management of costs and ensures regular supply, constant quality monitoring and volume.
Service and tailor made products More than any other pigment pastes, varnish or ink producer, we are able to provide solid quality products. Swift delivery of standard products and quick development of special tailor made products.
Geographical markets 13% of all Sioen Chemicals products are used within the Sioen group. The balance is sold to a wide variety of customers, mainly in Western Europe.
Sales organisation from the Bornem (Belgium) headquarters and the other subsidiaries.
R&D driven The Sioen Chemicals division boasts a well-working R&D centre with labs in all production plants and dedicated professionals each specialising in their main market. They focus on product development and innovation, but also on process improvement and product optimisation. Thanks to their efforts we have developed an extensive range of products suitable for use in a multitude of applications.
48 # SIOEN annual report 2009
apparel Division Sioen Apparel division is an innovative producer with a broad range of high end technical protective clothing. These comply with the most stringent European norms and regulations for amongst others rainwear, high visibility clothing, and flame retardant clothing, anti static and flame arc resistant clothing and chemical protection. Sioen is active in many different niches where people daily work in many different circumstances and where safety, comfort and security are major issues. Examples are: fire fighters clothing, chainsaw protection, flotation suits, bullet proof vests, clothes for operation theatres. Quality and flexibility go together with profitability and added value. Thanks to our constant innovation, we are European market leader.
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MAIN PRODUCT MARKETS
HIGH TECH Our high tech clothing offers maximum protection in changing working and weather environments. The high tech range is a combination of solid experience and interesting innovation.
HIGH VIS The high visibility safety range of Sioen includes a broad selection of fluorescent workwear for summer as well as winter periods. Thanks to our high-vis range the wearer is seen and accidents can be avoided.
Chemical Arc Protection and safety in the chemical and petrochemical industry is becoming more important every day, not least because of the stringent European regulations. Sioen offers a complete range of chemical and flame arc resistant clothing that complies with these norms and regulations.
50 # SIOEN annual report 2009
Agro Clothing for agriculture and horticulture has to be practical, waterproof, breathable, friction resistant and supple. Farmers and growers have to be able to work comfortably in any condition.
Food Flexothane Kleen ensures that our clothes comply with all hygienic and safety regulations in the food industry. The Nicewear range of Sioen offers protection up to -40째C. It combines two high tech tissues that are supple and water repellent on the outside and on the inside Iso-soft guarantees a high insulation.
Sio-Fit In the Sio-fit range you will find T-shirts and polos in many colours and with many kinds of retroreflecting stripes and a high wearing comfort. The range includes our new Sio-cool concept, clothes made of multi-functional yarns with fast drying, anti bacterial and deodorising characteristics.
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niche MARKETS Siofire-Vidal develops protective clothing for fire fighters. SIP protection guarantees safety and chainsaw protection in forestry. Sioen Armour technology specializes in bullet- and stab proof solutions for police, defence and security companies. Mullion produces flotation suits, life jackets and survival suits. Baleno aims for outdoor, hunter and fishermen’s clothing. Siomed produces textiles for medical sector and Military produces uniforms and protective clothing for all kinds of military applications.
Sio-Fire/Vidal We offer the widest range of life protecting solutions, combining the highest protection level with the best comfort. Our R & D department is constantly looking for new solutions, in close dialogue with the end users. Our strong focus on quality through all stages of the product are translated in a long lifetime of the garments and maximum protection in extreme circumstances.
SAT In the past few years we have been setting up distribution in most European countries, thus covering the need for quick deliveries in case of emergencies. The combination of protection and comfort is highly appreciated by our customers.
Mullion Our production facilities in 3 different countries allow us to produce within very short lead times and even make small production runs, based on specific customer needs. Also for the leisure market we have very attractive solutions both for flotation suits and life jackets.
52 # SIOEN annual report 2009
Sio-Med Our constant developments and fabric improvements are the basis of our growing turnover in gowns and drapes for the operation theatre. Due to our reprocessing support we offer a complete solution from the design stage up to the reprocessing in the laundries. This approach is highly appreciated by our customers.
SIP Chainsaw protection We enlarged our productportfolio to cover the needs of all markets. Our products are considered as beeing the safest solution with an interesting price / quality ratio. More and more customers choose for SIP, beeing innovative, comfortable, safe and reliable.
Baleno Baleno is the Sioen brand for modern, comfortable yet functional sports and leisure wear. This extensive range is specifically designed for the protection of outdoor sports and leisure and for hunters and fishermen. At the same time, the Baleno clothes are elegant and functional for daily use.
Production plants We continue to invest to keep our factories state-of-the art and to offer our customers the newest technology, giving them a competitive advantage. Our production plants are all working according to the highest quality standards. Our ethical and ecological business principles are approved by the most famous brands.
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industrial applications This division focuses on finished products and as a result processes coated fabrics, PVC membranes and filters for industrial applications.
54 # SIOEN annual report 2009
our activities The activities of the Industrial Applications Division are threefold and stand at the end of the Sioen Industries group’s value chain. > The processing of membranes (mainly in-house coated PVC technical textiles and foils) into finished and semi finished products such as kadors, pond and dam liners, tents, silos, camouflage nets, … > The production of felt and filters > The production of truck curtains, roofs and tilts
'The activities stand at the end of the Sioen Industries group’s value chain' the Sioen divisions # 55
our markets The division covers a wide range of markets, including automotive, leisure, the food industry, heavy industry and chemicals, transport and mining.
Kadors Sioen processes in-house coated technical fabric into kadors (flexible tubes enclosed in a technically coated fabric, into which profiles can easily be inserted, for example for caravan awnings).
Sio-steel Sio-steel is a patented composite consisting of a PVC coated steel net and double- sided PVC coated polyester fabric, used primarily for intrusion-resistant truck and train tarpaulins and side-curtains.
Carapax Carapax is an alternative to traditional roof curtains, giving additional resistance to the trailer superstructure and meeting the requirements of EN 12642XL. Carapax is a combination of aramid and technical coated textile.
56 # SIOEN annual report 2009
'Sioen specializes in producing needle felt and derived products' Cutting Cutting of technical textiles for the automotive industry (airbags, door panels, sun visors, etc.).
Pond and dam liners Cutting, splicing and packaging of sheeting for recreational ponds and industrial reservoirs, water basins and cultivating beds, for customers worldwide.
Filters and filter cloths Sioen specializes in producing needle felt and derived products such as filter cloths and complete ready-to-use filter systems. These filters are used in the food industry (water and air treatment in sugar refineries, breweries, etc.), heavy industry and metallurgy, mining, petrol stations, paper processing, cement companies, the chemicals industry, municipal water purification and after-burning plants. We recently started producing acoustic and thermal insulation panels.
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our MARKETS
Tents, covering systems, roll-down shutter doors, separating walls, silos A small percentage of our production of technical textiles is processed into finished and semi-finished products for high-tech applications for the army, the railways, the airline industry, and the construction sector.
Camouflage fabric Sioen specializes in the design, production and sales of camouflage fabric and multispectral camouflage netting. Worldwide, there are only a few companies active in this high-tech market, that calls for extensive technical knowledge and research and development.
Truck curtains, roofs and tilts Roland International produces truck curtains, roofs and tilts. Acquired by Sioen in 2003, the company focuses on large volume, batch production.
58 # SIOEN annual report 2009
geographical markets Over 20% of sales in this division are in Germany. This is because the largest trailer builders are in Germany. Other automotive applications (cut airbags, door panels, etc.) also find their way to Germany. The remaining 80% is divided between France, Belgium, the UK, the Netherlands, Eastern Europe and the USA. The two latter areas both offer considerable scope for growth.
Sales and distribution organization Sales and distribution channels differ from one product to another. We emphasise on cross-selling.
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