Velvet CARE Accelerates Growth with Third Paper Machine in Five Years
Velvet CARE is set to bolster its market presence with the construction of a third paper machine within a span of five years, as part of a substantial PLN 364 million ($91 million) initiative. The aim is to fortify its market position, enhance operational efficiency, and foster sustainable production practices.
The company has secured backing from the Kraków Technology Park for this venture, marking its third collaboration with the special economic zone. The upcoming paper machine, anticipated to amplify annual capacity by approximately 40% to 210,000 tonnes, represents Velvet CARE’s third significant installation in the last five years. Notably, the initiative encompasses the establishment of an automated warehouse dedicated to storing tissue products.
According to Velvet CARE’s Chief Executive, Artur Pielak, “With this project, we are maintaining our rapid growth trajectory as we strive to become a regional leader in the manufacture of consumer tissue products. Our focus remains on expanding scale and generating value for our shareholders, while concurrently fostering a positive impact on our community and the regional economy. This is evident through our ongoing partnership with the Kraków Technology Park. Reaching this milestone holds significant meaning for us, particularly as we commemorate the 10th anniversary of our management buyout, which ushered in the current phase in the company’s 126-year legacy.”
Employing a workforce of approximately 900 individuals in Poland and Czechia, the Velvet CARE group has established itself as the market leader in branded consumer tissue products in Poland. Its facility in Klucze, southern Poland, stands as one of the most advanced and efficient in Central Europe. In conjunction with the three paper machines, the group oversees a total of 18 converting lines, producing toilet paper, kitchen towels, and hygiene facial tissues for both Central European and global markets.
Velvet CARE recently initiated its latest tissue machine in December 2021, with support from the Technology Park program. This expansion follows the commissioning of another machine in 2018, coinciding with the company’s acquisition by Abris. Furthermore, the company’s growth strategy in recent years included the acquisition of Moracell in 2020, Czechia’s largest paper hygiene product manufacturer.
Abris Investment Director, Tomasz Kujawa, emphasized, “Velvet Care’s rapid implementation of a third paper machine is a testament to the company’s investment strategy aligning with its industry-leading expansion. This initiative marks a triple victory for shareholders and stakeholders, the local economy, and environmental sustainability. It reflects our commitment to fostering ESG transformations within our portfolio companies. We commend the ambitious approach of the Velvet CARE team and eagerly anticipate the utilization of this investment to attain greater milestones.”
These fresh investments will enable Velvet CARE to optimize the utilization of heat and other energy sources, curtail water and raw material consumption, minimize waste, and endorse circular economy practices. Notably, Velvet CARE has succeeded in reducing CO2 emissions and water usage per tonne of output by 50% since 2013, all while augmenting tissue production fourfold, as outlined in its recent ESG report.
The rapid pace of investment undertaken by Velvet CARE has propelled the company’s sales to increase fivefold from PLN 260 million in 2013, when the management buyout from Kimberly Clark was finalized. With a projected revenue of PLN 1.5 billion for 2023, following a noteworthy 57% surge last year to a record PLN 1.3 billion, the company continues to demonstrate its resilience and robust growth trajectory.