In late 2009 I was quoted as saying 'Raw material values on the way up and dollar on the way down' and well, at the time of writing this in early May, we can see that I got it half right and half wrong. The dollar became stronger against the Euro, which increases the cost of raw materials that we use. The pulp became not only much more expensive but also as a result of the earthquake difficult to get. Fortunately Jujo Thermal is part of the Finnish forest cluster and we have secure supply of fibre but at these new dizzy prices. Pulp is more expensive than many paper grades today!

 

 

The world economic growth is picking up, and we expect the interest rates will follow. We have noticed a stiffer tone of voice from the credit insurance companies: new limits are impossible to get. At Jujo we try to keep a balance between our payments and our receivables; the world business would be much easier if we could all agree to maintain 30 or 60 days’ payment terms, no fail. As it is today we seem to pay our suppliers promptly but spend time and effort on collecting receivables. That energy should be used on making quality products at a lower cost instead of on matters of collection. Expect that as rates start to rise, suppliers will be attempting to control receivable performance.

 

 

This year there was also the threat of interruption to operations from various' non-working events', as strikes are called these days. We were impacted like much of Finnish industry but we managed to keep going. Although some of our overseas customers were unfortunate to have delays in shipping, basically Jujo Thermal came through the event without much ado. We have now agreements in place for labour wages, and we are also finding that the cooperation climate is improving in the Finnish paper industry. Our labour relations at Jujo Thermal are good and we meet with the union reps frequently.

 

 

In these times we continue to focus on our mission which is:

 

'We wish to be the customers’ first choice by offering technically advanced thermal papers. We hope to create customer satisfaction by answering to the customers exact needs.'

 

We will continue our new grade introductions with more resilient thermal papers coming soon, by optimising the raw material mix, and by taking cost out or increasing output wherever we can and at all times. Part owned by Japanese companies as we are, we are embarking on a process of continuous improvement but while this is productive and necessary, we must also be realistic and note that we must pass on the strong increases in raw materials that are being asked from us.

 

Peter Hutton

President & CEO