Net sales increased $6.7 million, or 18%, in the third quarter of 2017 compared to the second quarter of 2017. The increase in net sales principally reflects the continuing ramp-up of new business, which began to be produced and shipped late in the second quarter of 2017. Converted product net sales increased $7.2 million, with $6.9 million of the increase attributable to increased volume and $0.3 million due to an increase in the average selling price. Parent roll sales decreased $0.5 million, reflecting the utilization of increasing mill capacities to service new converted-product business. Cost of sales increased $5.5 million, or 15%. Standard cost of sales increased $4.2 million, or 15%, consistent with the change in sales. Major contributors to the remaining $1.3 million increase in cost of sales include: approximately $0.9 million of increased freight cost based on changes in customer and geographic distributions; approximately $1.0 million of increased material costs, principally for virgin fiber; approximately $1.2 million of increased overhead costs not yet covered by production and sales at the new Barnwell, South Carolina facility; and other factors such as inventory obsolescence resulting from changes in customers' product lines and certain manufacturing efficiency variances. Partially offsetting these noted changes in costs were: approximately $1.3 million of variances were capitalized that were directly attributable to preproduction test runs necessary to get Barnwell's new equipment ready for its intended use, and Pryor's absorption variance improved by approximately $0.6 million. Click Read More below for additional information.
Stora Enso continues to develop the Trayforma range further and introduces a new solution for conventionally heated food packaging applications, featuring less than 10% PET plastic. Trayforma is a wood fibre-based material for ready meals packaging, enabling brand owners and retailers to switch from fully fossil-based materials to renewables.
The new Trayforma PET34 material continues to offer core properties such as food protection and heat resistance but has a significantly reduced amount of fossil-based barrier materials. When heating food in conventional oven, board materials need a PET coating to provide heat resistance and protect food. Meeting the threshold of 10% PET plastic will be an important step in producing trays made of Trayforma a better fit for fiber-based packaging recycling streams, and for achieving recyclable labelling in markets such as the UK.
“We believe Trayforma products will have many future applications because they are low-carbon and help brand owners reduce their carbon footprint and use of fossil-materials, offering these benefits to consumers. Thanks to its renewable origin in wood fiber and its optimised barrier options, Trayforma range offers the right performance and several alternatives for the ready meals category, now also better fit for recycling,” says Tuomas Puonti, VP, Head of Business Line LPB Fresh & FSB from Stora Enso.
Earlier this year, Stora Enso introduced Trayforma PP – a material suitable for heating in microwave ovens — based on material containing up to 95% of wood fibers. For conventional ovens where PET coating is still needed, the reduction to 34gsm is a significant improvement and can still withstand temperatures up to 220 °C.
Trayforma is now also available in 420gsm for producing larger and sturdier microwave and conventional oven trays. In addition to Trayforma PET, Trayforma Bio and Trayforma PP will also be available in a 420gsm option.
Trayforma is a renewable wood fiber-based packaging solution for frozen and chilled food and safe for oven and microwave heating when functional barriers are used. Trayforma guarantees food safety and is highly formable and convertible.