Duni is one of Europe’s leading suppliers of inspiring table setting concepts and sustainable packaging solutions for take-away. The Group’s strong position has been achieved by focusing on food, people and design and the ambition to always help the customer create a positive food and drink experience. A combination of high-quality products, a well-reputed brand, established customer relations as well as a strong local presence in most European markets have resulted in Duni being a market leader in Europe. Increased focus on sustainable and eco-profiled solutions have further strengthened the Group’s position. Operations are conducted within four business areas: Table Top, Meal Service, Consumer and New Markets.

The Table Top business area offers Duni’s concepts and products primarily to hotels, restaurants and catering, and to companies in the healthcare and care sectors. Table Top mainly markets napkins, table covers and candles for the set table. Duni is a market leader within the premium segment in Europe. The business area accounted for approximately 51% (53%) of Duni’s net sales during the year.

The Meal Service business area offers concepts for meal packaging and serving products for applications including takeaway, ready-to-eat meals, and various types of catering. The business area’s customers are mainly take-away-driven restaurants, food producers, and health and care. As a niche player within this area, Duni enjoys a leading position in the Nordic region and has a clear growth agenda on identified markets in Europe. The business area accounted for approximately 17% (16%) of Duni’s net sales during the year. Biopac UK Ltd in the UK is included in the business area as of February 2018.

The Consumer business area offers consumer products, primarily to the retail sector in Europe. The business area’s customers comprise grocery retail chains, but also other channels such as different types of specialty stores, including garden centers, home furnishing stores, and DIY stores. The business area accounted for approximately 22% (23%) of Duni’s net sales during the year.

The New Markets business area offers Duni’s attractive quality product concept, table top concept and packaging to markets outside Europe. In addition to customer segments such as hotels, restaurants and catering, the business area also aims its offering at the retail sector. The business area accounted for approximately 9% (7%) of Duni’s net sales during the year. Duni has acquired several companies in New Markets since 2016. Southeast Asia is and has been a prioritized area for geographic growth. The most recent acquisition in order was BioPak Pty Ltd in Australia and New Zealand. Duni acquired 75% of the shares in the rapidly growing supplier of sustainable packaging. The company has a clear environmental profile and has been part of the business area since October 2018.

Trends and external factors

To enable better management of external factors, such as those due to raw material prices or macrotrends that govern customer needs and behaviors, Duni launched a new strategy for the years 2019 to 2023 in late fall 2018. The strategy’s long-term goal is to improve Duni’s growth. The short-term goal is to strengthen profit.

The main impacting Duni’s business the most are digitalization, customer customization, sustainability and the increase in take-away. As part of the new strategy, Duni has identified five areas that the Group will prioritize. Increased customer focus is a fundamental part of the strategy. To create the most attractive experience for the end customer, the Group is launching solutions that make it easier for customers to do business with Duni. New tailor-made customer concepts will also be developed with a focus on services and innovations. The goal is also to be the best partner for sustainable solutions, which includes an increase in the number of eco-products as well as a stronger focus on solutions for a closed loop. Increased digitalization in the supply chain will streamline operations, from administration to production and logistics. The fifth area primarily involves Duni’s internal activities. Here the Group’s core values play a key role, but areas such as internal communications and strategic acquisitions also have crucial parts to play.

Product and concept development

Within product development, Duni’s work involves new designs, form and color schemes, as well as new materials and product solutions. Duni focuses on product and concept development, and possesses a unique strength within form, design and functionality. Duni’s innovation process is characterized by the ability to quickly and flexibly develop new collections, concepts and products that create a clear added value for the various customer categories in the market.

Continuous innovation

Products in the Duni ecoecho® premium range are manufactured from innovative materials with a clearly improved environmental profile compared with the standard product range. Focus is placed on aspects such as resource efficiency, renewability, compostability, and responsible forestry.

ecoecho® includes, for example, products made from the environmentally-sound material bagasse, as well as an entire compostable range of single-colored napkins carrying the OK Compost® ecolabel.

Duni has a number of products that are an alternative to linen. The table cover material Evolin® combines the look and feel of textile and linen table covers with the advantages of single-use products. Evolin® is aimed at restaurants and catering firms that perceive an advantage in using linen-like single-use material.

Market development

Global economic prospects are one of the main indicators as regards growth on the HoReCa market. Broad economic growth is positive for the industry. It stimulates consumption within the HoReCa sector, as well as demand for single-use products. The long-term trend continues to point towards an increasing number of restaurant visits and an increase in the number of hotel nights, driven mainly by increasing urbanization, changed consumption patterns and a lifestyle trend whereby meals are increasingly consumed on the go. New restaurant concepts, such as ready meals in grocery stores, take-away and fast service restaurants, are continuing to increase and gain ever larger market shares. After several years of stagnating economic growth, consumers in the mature European markets are showing greater interest in seeking value, and HoReCa companies are competing harder to attain a greater share of the total mealtime market. On the customer side, continued structural changes are taking place within the restaurant industry, with restaurant chains that operate under joint brands growing at a faster rate than the market in general. This is a development that favors Duni’s sales of customized concepts.

Duni’s product category in retail focuses both on the production of private retail labels and sales of Duni’s own brands. Distribution of parts of the category has also expanded into new channels, such as gardening centers, home furnishing stores and DIY stores.

Another sector of the market comprises the serving of food to companies and institutions. It is primarily the care sector that is taking larger share of the segment, and the market has experienced stable growth in recent years. Here, there is clear potential for Duni to create growth.


The HoReCa industry is greatly influenced by lifestyle changes and trends. Long-term demand is being driven primarily by greater purchasing power combined with changed habits, including an increased proportion of meals being eaten outside of the home. Demand for brand-profiled and environmentally-sound single-use products is also increasing. Furthermore, the trend towards increased accessibility and convenience connected with meals is continuing, and thus the take-away alternative is continuing to grow. This trend is reinforced by the increase in the number of single households and the fact that urbanization is continuing. The number of restaurant chains that wish to profile their brands through single-use products is also increasing, and this is an area where Duni is well positioned.


The annual report covers the 2018 financial year. “Preceding year” refers to the 2017 financial year. Duni controls its operations based on what Duni refers to as operating income. “Operating income” means operating income before restructuring costs, non-realized valuation effects of currency derivatives, fair value allocations and amortization in connection with business acquisition. For the bridge between EBIT and operating income, see the table below.

Restructuring costs amounted to SEK -31 m (0).In the fourth quarter, an efficiency-improvement program was launched with a focus on cutting indirect costs. This covers Duni’s entire business and includes streamlining and downsizing. Around 60 people are affected and the total restructuring cost of is estimated at SEK 33 m, of which SEK 31 m was recognized in 2018. The annual savings of this program are estimated to exceed SEK 35 m with a gradually increasing impact in 2019. In 2017, restructuring costs were incurred for efficiency improvements in marketing and sales. The Company also received damages attributable to the period before Duni was listed. This revenue is also attributable to the Parent Company. For more information on restructuring costs, see Note 9.

Bridge between operating income and EBIT

SEK m 2018 2017
Operating income 430 491
Restructuring costs -31 0
Amortization of intangible assets identified in connection with business acquisitions -43 -34
Fair value allocation in connection with acquisitions -6 -1
Reported operating income (EBIT) 351 456

Net sales

Duni’s net sales amounted to SEK 4,927 m (4,441), a 10.9% increase in sales. At unchanged exchange rates from the preceding year, net sales would have been SEK 268 m higher compared with the outcome for 2017, representing a 6.0% increase in sales. Organic growth, excluding structural changes, amounted to 1.5% at fixed exchange rates.

The Table Top business area reported net sales of SEK 2,486 m (2,338). At fixed exchange rates, this corresponds to a sales increase of 1.1%. Several key markets increased their sales during the year, but sales fell in Duni’s largest market, Germany, and in the Nordic region. Napkins experienced stable growth while overall growth is still being slowed down by lower demand for table covers.

The Meal Service business area reported net sales of SEK 846 m (704). At fixed exchange rates, this corresponds to a sales increase of 15.9%. In February, Biopac UK Ltd was acquired and consolidated in Meal Service. Organic growth excluding the acquisition amounted to 6.4% and the business area also shows growth in all regions. The Ecoecho® assortment in particular is making progress and is now a material part of the total portfolio.

Within the Consumer business area, net sales amounted to SEK 1,061 m (1,010). At fixed exchange rates, this corresponds to a sales decrease of 0.6%. The business area succeeded in retaining sales levels for customer-specific products despite excess capacity in the market for both contract production and napkins geared toward the retail sector. In addition, the business area had lower sales to one major international customer. Growth in key markets such as Germany and the Netherlands played a key role in propping up sales.

The New Markets business area reported net sales of SEK 448 m (322). At fixed exchange rates, this corresponds to a sales increase of 35.9%. As of October, acquired company BioPak in Australia is a part of the business area. Excluding acquisitions, the sales of New Markets decreased by 10.0%. Several markets near Europe, which were previously included in the New Markets business area, have been moved to the Table Top business area. Russia, the US and Thailand exhibited stable growth during the year. Singapore reported lower sales, which were impacted by the relocation of warehouses and offices and the implementation of a new ERP system.


Operating income amounted to SEK 430 m (491). At unchanged exchange rates from the previous year, EBIT was SEK 94 m lower for the year. The gross margin amounted to 25.9% (28.5%) and the operating margin decreased from 11.1% to 8.7%. As a result, the financial target of an operating margin over 10% was not met. The sharp increase in pulp prices is responsible for dragging down net income for the year. In addition to pulp prices, the costs of electricity, cardboard, polystyrene and shipping (referred to as inputs) all increased significantly during the year. A price increase was implemented early in the year but pulp prices continued to rise. As a result, a second price increased was announced and was in the process of implementation at year-end. This will gradually take effect in Q1 2019.

The Table Top business area and especially the Consumer business area were hit the hardest by the sharp raw material price increases during the year, which consequently decreased their operating income. The income of New Markets also decreased, partly as a result of the high raw material costs but mainly due to high costs in connection with the relocation of warehouses and offices and the implementation of a new ERP system at Duni’s company in Singapore. Meal Service, with a portfolio that is not dependent on pulp prices, experienced a significantly better year and increased its operating income.

Net financial items amounted to SEK -22 m (-17). Income before tax was SEK 328 m (439).

A tax expense of SEK 79 m (106) was reported for the financial year. The effective tax rate was 24.0% (24.0%). The tax expenses for the year include adjustments and non-recurring effects from the previous year of SEK -2.6 m (-1.3).

Net income for the year amounted to SEK 249 m (334), of which non-controlling interests amounted to SEK 4 m (5).


The Group’s net investments excluding acquisitions amounted to SEK 198 m (234). Duni invested SEK 45 m during the year to upgrade the airlaid machine at its subsidiary Rexcell Tissue & Airlaid AB. The investment increased airlaid capacity by approximately 25% per year. In 2017, an SEK 55 m investment was made in a logistics property in Germany. Apart from this, the investments related primarily to the Group’s production plants in Poland, Germany and Sweden. Depreciation/amortization amounted to SEK 201 m (174).

Cash flow and financial position

The Group’s operating cash flow was SEK 343 m (449). Cash flow including investing activities amounted to SEK -289 m (156). Two acquisitions were made during the year, which impacted investing activities by SEK -427 m.

The Group’s balance sheet total on December 31 amounted to SEK 6,027 m (4,833).

The Group’s interest-bearing net debt amounted to SEK 1,490 m, compared with SEK 855 m on December 31, 2017.

Operational and financial risks

Duni is exposed to a number of operational risks that are important to manage.

The development of attractive product ranges, particularly the Christmas collection, is very important in order for Duni to achieve satisfactory sales and income growth. Duni addresses this issue by constantly developing its range. Approximately 25% of the collection is replaced each year in response to existing trends and to shape new trends.

A weaker economic climate over an extended period of time in Europe could lead to a reduction in the number of restaurant visits, reduced consumption and increased price competition, which might impact on volumes and gross margins through factors such as increased discounts and customer bonuses.

To minimize risks in the form of, inter alia, fire, disruptions or other damage to inventory, property and plants and to cover liability, the Company has a comprehensive insurance program covering the entire Group.

The Board’s audit committee conducts annual reviews of the Company’s operational and financial risks based on the risk analysis conducted. This also includes environmental risks as well as risks related to entry into new markets such as anti-corruption, fraud and social aspects such as conditions from an labor law and diversity perspective. The Company’s approach to managing different risks is presented in the policy that the Board reviews and approves each year. It is important that management and the Board have a shared view of what risks the Company is exposed to, and to ensure there is a monitoring strategy for each individual risk. Brexit was identified as an operational risk during the year as it could impact Duni’s operations in the UK.

Duni’s financial management and its management of financial risks are regulated by a finance policy adopted by the Board of Directors. This work is presided over and managed by the Group’s Finance Function (EFF), which is included as a unit within the Parent Company. The Group divides the financial risks into market risks (consisting of currency risks, price risks and interest rate risks), credit risks and liquidity risks. These risks are controlled in an overall risk management policy that focuses on unforeseen events in the financial markets and endeavors to minimize potential adverse effects on the Group’s financial results. See also Note 3 regarding risk management.

Legal disputes

Upon closing of the accounts, there were a few disputes with customers and suppliers involving small amounts. Provisions have been made in the annual accounts that, in the management’s opinion, cover any negative outcome of these disputes. See also Note 35, Pledged assets and contingent liabilities.

Sustainability report

Duni’s corporate social responsibility work (including policies and significant risks in the areas of the environment, social conditions, personnel, respect for human rights, and anti-corruption) is collected into an overarching program called “Our Blue Mission”. The program is updated and presented annually in an independent report that is published at the same time as the annual report. Duni’s sustainability work is also reported here in the directors’ report under “Environment and social responsibility” and “Employees and work environment”. See also Note 35, Pledged assets and contingent liabilities.

Environment and social responsibility

In accordance with an adopted environmental strategy, Duni works according to policies and goals covering development and information concerning products, efficient and controlled production, as well as knowledge and communication from an environmental perspective.

An environmental management system and a quality management system in accordance with ISO 14001 and ISO 9001, respectively, have been implemented and certified at all of the Group’s European production units.

Suppliers of goods for resale and significant raw materials are evaluated according to the Group’s code of conduct, which covers both environmental and social responsibility. Prior to new contracts for the purchase of goods for resale, an audit is first performed at the supplier’s plant based on the code of conduct. Audits are also performed on a regular basis at existing suppliers based on a risk assessment that takes into account the suppliers’ location, previous results and type of production. The audit focuses on human rights such as the risk of child labor and involuntary labor, as well as working conditions, pay conditions and working hours.

Duni has also been granted FSC® certification, license number FSC-C014985 (Forest Stewardship Council), regarding the sale, production and distribution of products such as napkins, table covers and serving products. This means that Duni’s paper products are sourced from sustainable forests and other controlled sources.

Rexcell Tissue & Airlaid AB conducts two operations that are subject to permit requirements pursuant to the Swedish Environmental Code. The Group holds permits for the production of 65,000 tons of wet laid tissue per year and 52,000 tons of airlaid tissue per year at the mill in Skåpafors and 10,000 tons of airlaid tissue in Dals Långed. The mills hold permits issued by the Administrative Board in Västra Götaland County regarding emissions of carbon dioxide (CO2). For 2018, the allocation of emission rights was 0 tons in Dals Långed and 18,078 tons in Skåpafors. The total allocation of emission rights will diminish each year up to 2020, when Dals Långed will have emission rights corresponding to 0 tons per year, and Skåpafors 17,349 tons per year. The Dals Långed production plant is dormant and emission rights are not used when there is no production. The allocation of emission rights from the country administrative board is dormant as of 2017 but can be reactivated as of 2020 by application.

Excess emission rights are carried forward to the next year and, if the emission rights are insufficient, the Company purchases additional rights. If purchases of additional rights are made in 2019, the Company estimates that these will not reach any significant amount. In 2018, Rexcell Tissue & Airlaid AB had 4,672 (5,130) unused emission rights with a market value of SEK 0 m (0). In total, 13,406 tons were used in Skåpafors in 2018.

Employees and work environment

Duni operates based on four core values that provide guidance in the day-to-day work and clarify how things are done “the Duni way”. The core values – Ownership, Added Value, Open Mind, and Will to Win – find concrete expression in a number of operational principles that, taken together, are aimed at creating profitable growth, organizational efficiency, and increased customer satisfaction.

Good working conditions, clear goals and structures combined with regular support to employees form the foundation for creating growth and profit. Human Resources (HR) has the task of supporting management, supervisors and employees in order to stimulate employee development, increase involvement, and drive and coordinate change processes. Duni works actively with diversity in many different ways to make it clear within the organization that it is considered an important issue. Duni shall be a company that reflects the surrounding society. HR also assists in the work of ensuring a sound work environment for all employees. Since 2014, development plans have been gradually produced whereby all employees in the organization shall have clear, individualized goals that are followed up. Duni’s code of conduct for employees also includes the work environment. Systematic work on the work environment is performed at Duni’s plants, and is audited through internal audits based on Duni’s code of conduct. Each month, Group Management and the Board receive key ratios concerning accidents and sick leave due to accidents at the plants.

Duni’s Board has a clear policy that all employees must be aware of prevent corruption. In addition to compliance with the code of conduct, the Duni Board has also adopted a business ethics policy that all employees and suppliers are expected to follow. This policy states how Duni as a company and its employees must observe accepted business practice and act in accordance with the Group’s ethical standards and expectations. The business ethics policy states in particular how managers and employees are expected to act in their contact with customers, suppliers, owners, competitors and other external parties. Duni requires that all third parties, suppliers and external parties with whom Duni cooperates shall comply with Duni’s business ethics policy and applicable legislation in the respective country.

Duni also has a whistleblower policy that clarifies that any suspicion of fraudulent behavior, corruption or other similar situations that are witnessed must be reported without delay. An external whistleblower system manages reports, which can be made anonymously if desired. The recipients are the HR Director, the CFO and the Chairman of the Board’s Audit Committee. No whistleblower cases were reported during the year.

As of December 31, 2018, the Company had 2,477 employees. The number of employees on December 31, 2017 was 2,362. 1,085 (1,057) of the employees were engaged in production. Duni’s production plants are located in Bramsche and Wolkenstein, Germany, in Poznan, Poland, in Bengtsfors, Sweden, in Bangkok, Thailand and in Auckland, New Zealand.

The Board’s work

Since the Annual General Meeting held on Tuesday, May 8, 2018, the Board of Directors comprises five members and two employee representatives. Two alternate employee representatives also attend board meetings. During the year, the Board held nine meetings at which minutes were taken. For further information on the work of the Board, see the Corporate Governance Report.


Principles regarding the CEO and senior executives, as proposed to the 2019 Annual General Meeting, to be applicable in 2019 up until the next Annual General Meeting, correspond in all essential respects to the established principles which were adopted by the 2018 Annual General Meeting. For information regarding remuneration to the CEO and senior executives and relevant guidelines, see the Corporate Governance Report and Note 13.

Foreign companies and branches

Duni conducts operations under its own management and has employees in 24 countries.