Alpha Centauri project TM7 start-up Agenda Velvet Care Company - - PowerPoint PPT Presentation

Alpha Centauri project TM7 start-up

Agenda

➢ Velvet Care Company presentation ➢ Alfa Centauri project aim ➢ Project execution ➢ Project routine ➢ Operator training ➢ Start-up ➢ Learning curve ➢ Key learnings

Over 120 years of history. 17 years as a part of international companies.

1897 Establishment of the paper factory in Klucze 1976 Activating of new paper machine #6 1996 Acquisition by International Paper 1997 Launch of Velvet brand 2003 Acquisition by Kimberly-Clark 2013 Acquisition by Avallon MBO II 01.08.2013 Formation of Velvet CARE 2013 Acquisition by ABRIS

120 years of Klucze mill history in 2017

Klucze mill established in 1897, since then delivering products of the highest quality.

Organizational structure / Board Members

Rafał Curyło Finance Director – Member of the Board In the company: 17 years Business experience: 17 years

• CBU Modern Trade
• Business Analyst

Leader Central Europe

• Business Analyst Poland
• Controlling Specialist

Artur Pielak General Manager – President of the Board In the company: ca.5 years Business experience: 21 years

• Hero PL/HU - General Mgr
• Nestle PL/BAL – Marketing Dir
• Gillette CEE – Bus Unit Mgr
• International Paper – Cat Mgr
• Unilever – Brand Mgr

Marcin Grabowski Sales Director – Member of the Board In the company: ca. 18 years Business experience: 22 yrs Prior experience:

• Cust. Bus. Manager MT
• Bus. Develop. Manager
• Regional Sales Manager

Marek Ściążko Mill Manager – VP of the Board In the company: 32 years Business experience: 34 years

• K-C S.A. Poland – Mill Dir
• International Paper – Mill Dir.
• KZP Klucze – Mill Director

Operations/ LEAN Logistics Cust Service Distribution Quality, safety and environment Mill engineering HR/Unions Finance & IT Marketing & Category management Sales Export & Business Development Demand Planing

We have ca. 570 Employees – majority experienced in Paper industry

Velvet Care – pillars of our strategy

Private Labels DACH markets

– strategic partnership

Export

New categories

Away From Home

VC NSV: 2014- NSV 40 mln EUR 2017- NSV 100 mln EUR 2020- NSV 150 mln EUR+

Velvet Care – investments in development

In the last 3 years we’ve upgraded existing and 5 new production lines, built high-tech warehouse and doubled or production capacity and turnover: 2014

• upgrade of existing production lines

2015

• technology of putting balsam on tissue and paper production lines
• new production line for moist paper and wet wipes (1)
• new production line for hanks tissues (3)

2016

• new production line for facial tissues (2)
• new production line for bath tissue (4)
• new production line for Jumbo towel based on DESL technology (5)

2017

• Opening of new finished product warehouse (6)

6

Velvet- synonym of tissue hygiene in Poland

Synonym of high quality… …appreciated by retailers… …and consumers.

Gold Medal Quality Leader by Consumers In all 4 categories

Complex product portfolio for each group of shoppers

Kitchen Towel Facial tissue Bath tissue

Economy Mainline Premium

Strong business in Private Label products

Alfta Cenaturi project aim

2018 is a year of the revolutionary change and the biggest investment in company development

• Activating of new tissue machine
• Another new production line for bath tissue

Business goals:

• Strengthening Velvet Care position as an innovator and

creator of paper market in Poland

• Further development in Private Label business
• Export development
• AFH business doubling

430mln

Project execution ➢ July 2016 final supplier TM definition ➢ August 2016 Internal Velvet Care Kick off meeting ➢ September 2016 Project Kick off meeting – 3 companies VC, Valmet and Building company ➢ December 2016 Layout drawings delivered by Valmet

Project execution ➢ March 2017 delay of Civil company required new project schedule. Original January 2018 start-up was moved to March 2018. All companies were informed about delay ➢ Valmet and Iinstallation company schedule remain unchanged - the equipment was delivered according original schedule. The installation company started during civil construction work. ➢ New flexible checkout process was established by Valmet

Time Basic Engineering Detail engineering Manufacturing Civil design Civil execution Installation execution Q1’17 100% 60% 20% 30% 5% 0% Q’2 17 100% 75% 54% 40% 20% 0% Q’3 17 100% 99% 91% 80% 60% 20% Q4’17 100% 100% 100% 100% 98% 75% Q1’18 100% 100% 100% 100% 99% 100%

Project routine ➢ Official report to the management board and financial institution – 1 x quarter ➢ Steering committee meeting – 1x month – lead by VC project manager ➢ Civil company progress/decision meeting – 1 x week – lead by VC civil project manager ➢ Installation company progress/decision meeting – 1 x week – lead by VC process project manager ➢ Civil company operation daily meeting – Installation operational daily meeting

• lead by Valmet Site Manager

➢ Daily startup meeting in control room

• lead by Valmet Site Manager

Training ➢ Q1 2017 – New process engineers (packaging paper background) joined the team ➢ Q2 2017 – Karlstad Valmet week training for process engineers and mechanical engineer ➢ September 2017 –new operational crew joined VC (only 4 people had papermaking experience, moreover only one of them was TM leader) Training steps ➢ Stage 1 The basic info for paper making processs. The crew had different trainer every day (future leader of TM machine) ➢ Stage 2 – the teams were divided by job position (stock preparation team; refining team; rewinder team) The training covered equipment and working procedure for each job position ➢ Stage 3 – practical activities during old TM6 annual shot down. ➢ Stage 4 – practical activities on old TM. The crew was TM6 employee shadows ➢ Stage 5 – Simulator class training. Basic DNA system information ➢ Stage 6 – Simulator problem solving

Training The VC training program was finished in December 2017 Valmet training started in January 2018 and finished in March 2018 ➢ Calss room training separately for stock preparation and TM ➢ Practical training – shadow of Valmet specialist during checkout time ➢ Start-up training – on working equipment

Alfa Centauri – Project start-up

➢ 02.03.2

3.2018 018 13:00 :00 First st reel on TM7 – BT 16,5 GSM

➢ 05.03.2018 Commissioning completion date (TM7 take – over). Signed certificate ➢ 12.03.2018 Project first preliminary production criteria confirmed more than 716 ton for 7 days ➢ April 2018 – first 180 t/ 24h was achieved ( 4 days above 170 t/24h production) ➢ May 2018 Project intermedia test was delivered ( 200 t/ 24h) ➢ July 2018 – first 2000 m/min speed was achieved ( only 4h production due to still LC on rewinder)

Project Learning curve

Time March April May June July August September Plan 40% 50% 60% 70% 80% 90% 100% Actual 65% 66% 66% 74% 85% 72% 88%

Project key learnings ➢ Reference visit is necessary to establish good business case for the project ➢ Clear common goals for all people and suppliers involved in the project ➢ Team working action (not only execution from suppliers but cooperation is required) ➢ Communication and face to face discussion – not only tele conference. The face to face meetings are more effective, the communication flow is better, the clarification of issue is better too. ➢ Focused on the issue not only on the contract scope ➢ Milestones definition and tracking process ➢ Training program is crucial ➢ Risk management – risk assessment in the project is necessary

Project key learnings after startup ➢ Checkout procedure is crucial and need time. Speed-up in checkout can cause longer start-up (issues during the machine start because the system was not checked properly) ➢ Punch list after start-up need to be closed as soon as possible due to crew demotivation and bad learnings. ➢ People solve the problems – key responsible contacts allow you solve your issue quicker (Hans and Gunnar Thank you !!)

Civil movie - outside