SCA has announced it will strengthen its competitiveness in the hygiene market to “intensify growth and the pace of innovation”, making a number of changes to its operations.
Some 85% of the company’s sales are derived from its hygiene operations, and as of 1 January 2016 the company will undertake a number of objectives.
- Reorganising its AfH tissue and incontinence products in Europe and North America into two business units, Away from Home Professional Care (led by Don Lewis, currently president of SCA Americas) and Incontinence Care (led by Margareta Lehmann, currently president of SCA Incontinence Care Europe).
- Latin America will become a new business unit, SCA Latin America, led by Pablo Fuentes, vice president of SCA Latin America.
- Global Hygiene Supply Tissue and Global Hygiene Supply Personal Care are “being strengthened through the respective production activities being given direct reporting lines”.
- A project to streamline logistics is also being organised and will be led by Sune Lundin, president of SCA Away from Home Professional Hygiene Europe.
Magnus Groth, SCA president and chief executive, said: “The new organisation provides the preconditions for increasing efficiency, the pace of innovation and profitable growth for our global hygiene operations.”
He added that the organisational changes have no impact on SCA’s external financial reporting structure.
Additionally, the SCA Group has also been divided into two divisions: a Hygiene division and a Forest Products division.
In relation to the Forest Products division, all forest industry and forest land currently owned by SCA will be merged into one division.
A decision has also been made to invest in increased capacity for pulp production in the forest products operation.
Groth added: “The enhancement of the organisation and the investment in increased pulp production will secure the long-term competitiveness of the businesses.”
Work to realise this consolidation has begun.
To satisfy the growing demand for pulp, SCA has decided to invest in increased capacity for pulp production at the Östrand pulp mill in Timrå, Sweden.
The production capacity of bleached sulphate pulp will increase from 430,000tpy to 900,000tpy.
Production for the SEK 7.8bn investment is expected to commence in 2018.