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IR-CONTACT

Anders Spetz, CEO

Tel: +46 (0)703-47 97 00

Message from the CEO

Lund 3rd October 2016

Strategic focus on masterbatch deliveries

In our continued market efforts we see that the strategic decision, on delivering Nexam Chemicals technology to customers as masterbatch, was correct. During the summer and early autumn, we have put much focus on carefully evaluating potential masterbatch manufacturers. A number of companies have been analyzed based on their capacities and capabilities. We’ve also had in-depth discussions with a few selected companies, who have completed up-scaling trials for production of our masterbatches. The aim has been to get to know these manufacturers and validate their production processes and product quality. The masterbatch products have been used by our customers with positive outcome. As a result, strategic partnership and/or acquisition discussions are now underway with a couple of manufacturers.

Business update

Polyethylene pipes

We are step-by-step moving forward on deliveries of product for pipe applications based on polyethylene. Our existing commercial customer is in a process which aims to increase the rate of deliveries, by introducing Nexam Chemicals product to additional production facilities. In parallel promising results have been achieved with other pipe manufacturers.

Our ambition is to broaden the product offering, based on the positive response we have received from large manufacturers of polyethylene. These companies are already delivering polyethylene to the pipe manufacturers, but they are in need of improving their products. Nexam Chemicals products intended for polyethylene can now be considered as fully developed for pipe applications. However, the polyethylene manufacturers are still working in pilot or up-scaling stages and some development remains until implementation. The potential is huge but, even if sales can be expected to take off in a relatively near future, sales of larger volumes lies a couple of years in the future.

Polyester foam, e.g. PET

As previously communicated, we work with all the market leading manufacturers in the world. We have learned, after a long time of working closely with these companies that their respective manufacturing processes differ. Therefore, we must “package” our technology in a unique way for each customer. Our masterbatch focus provides the means to deliver a tailored product to each customer. The technical results achieved so far are very positive and we have concepts that provide our customers with significant property enhancements.

High performance applications

The number of customers that we classify as commercial according to our business model is increasing. The volumes are still relatively low and typically these customers work with low levels of our products to obtain the desired effect. This is, of course, positive looking forward, but it means that it will take time to build a significant market. The high performance products are applicable in a number of different products and industries. Consequently, each customer has unique requirements concerning the type of property enhancement that is required. We continuously see a high interest from a number of companies that wish to evaluate our technology. However, in this segment, the time between first tests to commercial sales are long.

Development

The final project meeting for the rPET-project, partly financed by Vinnova/EUROSTARS, will be held in the near future. At the meeting, the partner companies will present their findings to representatives from the financing authorities. In short, the technical results of the project are positive and the project goals have been achieved.

Nexam Chemical is, in collaboration with one of the world’s largest pipe manufacturers, working in a development project for a new type of pipe. For this project, the technical team at our production facility in Scotland has developed a new manufacturing process on an existing product in order to fulfil the environmental requirements of our partner. Product evaluation is ongoing. The application areas for different pipe qualities are strictly regulated and every new quality requires certification by the authorities before market launch. This means that despite the positive results, a commercial launch of this new quality will take time.

Organization

Johan Arvidsson joined the company in August, acting as Head of Sales. He has quickly got to know the business and has activated his broad network of contacts within plastic manufacturers around the world. His network is priceless for a company of Nexam Chemicals size and it is essential when selling a new technology in an established and conservative industry. With Johan, our already slim organization has become even more effective. Key success factors for us is to be well informed, responsive and decisive. Every recruitment is of importance and we intend to recruit additional sales and market resources when we identify the right persons with the right profiles. Since January 2015, when I took over as CEO, the number of employees has been reduced. As a result of this, we have moved to new and more adaptive offices and also realized a 50% cost reduction in rents.

Trade fair – K 2016

Between 19th and 26th of October the world’s largest trade fair for the plastics and rubber industry is held in Düsseldorf. The trade fair has over 200 000 visitors from 120 countries. We will of course be there with several of our employees to meet and make business with existing and potential new customers. Read more about the trade fair on K 2016.

Newsletter

We will shortly publish the first in the series a regular newsletter where we intend to touch on everything from how the organization works, to describe specific customer case studies, technology and applications, market trends or interesting areas within plastics that are or may be relevant for Nexam Chemicals technology.

Anders Spetz, CEO

Note: This news has been translated from Swedish. The Swedish text shall govern for all purposes and prevail in case of any discrepancy with the English version.

 

 

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Lund 17th December, 2015

Video interview

CEO Anders Spetz gives an update and summarizes year 2015 and look ahead into 2016 based on Nexam Chemical´s model for business development with three focus areas. (In Swedish).

 

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Lund 9th October, 2015

Our strategy with three focus areas shows result – first industrial orders won!

I would like to take the opportunity to, in between quarterly reports and press releases of significant events, give a business update on the status of Nexam Chemicals operations.

Strategic focus

Our new strategy with focus on three application areas - polyethylene pipes, polyester foams and high performance applications - remains intact, and the development follow the plan we have established. Based on the positive results we have obtained, we now intend to accelerate our efforts even further. We have gone from "proof of concept" within all three application areas, to full scale test runs at customers and we are now approaching industrial sales in all. The ambition is to move from one buying customer per application area, to our next milestone of having at least five commercial customers in each area.

Next phase in the development will be an expansion to a larger number of customers and broadening the number of application areas. This will require that we adapt the way we organize the business in order to enable an acceleration in growth rate. Starting point for this next phase is the joint development work we today do together with a large number of customers with promising results.

Business update

Polyethylene pipes

As previously announced, we can conclude that Nexam Chemicals technology for modifying polyethylene intended for pipe applications has had its commercial breakthrough. Tests have been ongoing and will continue in parallel with several customers for a number of different applications. The prospects for receiving more orders in this area relatively soon are considered to be good.

Polyester foam, e.g. PET

There is a number of ongoing activities at several customers, ranging from tests in the laboratory to pilot runs and tests in full-scale production. Nexam Chemicals technology for this area has proven to be extremely effective already at a very low dosage. We continuously develop our offering to the market based on the value our products creates for the customer. This is also an area in which we prioritize expanding our customer base.

High performance applications

We now receive continuous orders of industrial scale even though the volumes still are low. One of our customers have been able to commercialize a product, in which NEXIMID® have a crucial effect. This concerns applications related to the electronics industry. Also within this area there is a great potential for expanding the customer base.

From research to development

Our shift in focus towards more application related development has led to a more active partnership with a major player in the specialty chemicals sector, Evonik. We have agreed that together approach polyimide customers with our high performance segment. Our product offering complement each other in a unique way. By taking advantage of both parties interacting products, the desired properties of plastics can be achieved.

The work in our plastic application laboratory continues with high intensity. The equipment we have installed is best suited for the development of polyethylene and polyester applications. The much more advanced development work carried out within the high performance range are made primarily by our customers in their specialized laboratories.

Organization

As part of the savings program implemented, the reduction in personnel announced earlier is now fully implemented and our costs are continuing to decline compared to last year. I would like to take the opportunity to thank the fantastic team at Nexam Chemical for their outstanding performance during this period. We have succeeded in raising the level of activity and results, despite less resources. 

The recruitment of a new head of technical services / technical sales is entering into its final stage with selection and in-depth evaluation of the final candidates.
On the sales side, negotiations are underway with a number of distributors that will represent on Nexam Chemicals behalf. 

I look forward to deliver on the established strategy!

Anders Spetz

CEO

Note: This text has been translated from Swedish. The Swedish text shall govern for all purposes and prevail in case of any discrepancy with the English version.

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Lund 2nd July, 2015

Nexam Chemical on the right track!

I would like to take the opportunity to give shareholders and other stakeholders in Nexam Chemical a brief business update before the upcoming holiday period.

 

Strategic focus

Since I took over as CEO, the management and the board of directors has, as previously communicated, changed the strategic focus of the business. In order to develop Nexam Chemical to a commercial success, the way forward is spelled FOCUS. During the spring we have carefully evaluated our business opportunities, prioritized the best and matched them with our assets and resources. What we communicated during the spring is still valid – our focus today lies within pipes made from polyethylene (PE), foam made from polyester (PET) and our high performance products.

 

Business update

We can confirm that our products attract much interest from the market within our chosen areas of focus and that there are ongoing full-scale tests and some initial sales in prioritized segments. Before drawing to many conclusions from this, it should be kept in mind that it takes time for our customers to evaluate and adapt their commercial offers to generate volume sales of end products containing Nexam Chemicals technology. In several of the customer projects in progress, we can also conclude that our specialist expertise is an important part of the business case. A key component, that is critical for future development, is our ability to provide cost effective solutions.

 

During spring and early summer we have introduced several formulations at an attractive price level in relation to created customer value. This opens up new opportunities in the high-volume segments. Meanwhile, there are some customer projects that need to step back to the laboratory in order to find the solutions. One such area relates to polypropylene (PP), which we prioritize with the ambition to develop a commercially viable solution.

From research to development

 

I am satisfied to see that we in short time have been able to shift our focus from research at a molecular level to development of applications, where our products are included as a value creating component for the customer. In our application laboratory in Lund we have intensified our tests where we simulate our customers’ production processes with NEXAMITE®-modified plastics. This way we can facilitate for our customers to adapt their production processes in order to maximize the value of Nexam Chemicals technology.

 

Furthermore, we have completed a major restructuring of our R&D. We have consolidated all research activities to our facility in Scotland and closed our chemistry laboratory in Lund. This gives us a better use of our resources and a clearer focus where Scotland manage all research activities and QC, while Lund focus on all development of applications. Our research activities are now focused on refining the formulations for polyethylene and polyester. All ongoing new research is mainly focused on finding an effective formulation for PP (polypropylene).

Cost saving program

 

Our program for reducing cost is proceeding according to plan and we can already see positive effects of this. The operational expenses have been reduced, including the closing and relocation of chemistry laboratory in Lund, reduced external costs for e.g. advisers and downsizing of personnel. In total, the personnel in the parent company and subsidiaries have been reduced with nine employees. Primarily within administration and long-term research activities.

Organization

 

Our new CMO Lars Öhrn has now assumed his position and has started his assignment within Nexam Chemical in an exemplary manner, focused and with full speed ahead on customer activities. Through his unique experience and network, he has already brought new possibilities to the company.

At the same time, we intend to strengthen our team with additional sales skills and technical customer service. These recruitment processes have already begun.

 

Finally, I wish everyone a great summer! Nexam Chemical is open all summer and our projects are progressing continuously.

Now we are doing business. Going forward, we want them to increase!

  

Anders Spetz

CEO

 

Note: This news has been translated from Swedish. The Swedish text shall govern for all purposes and prevail in case of any discrepancy with the English version.

 

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Lund 17th June, 2015

Småbolagsdagen 2015

Nexam Chemical participated on 8th of June 2015 at "Småbolagsdagen 2015", arranged by Aktiespararna and Redeye. The video presentation with CEO Anders Spetz and the PowerPoint presentation can be found in the links below.

Video from Småbolagsdagen 2015 (SVE) 

Presentation from Småbolagsdagen 2015 (ENG)

 

Lund 19th March, 2015

First one hundred days with Nexam Chemical

Most of you who are interested in Nexam Chemical, have noticed that we have been moderate with our communication so far this year. As the new CEO, I have chosen to consciously use my first hundred days to form a proper understanding of the business. It is clear that we, during the last year, not have been able to deliver on our own and others' expectations. With this background it is even more important to know where we stand.

Just as I expected, I can now say that there is a lot that is working well. Pleasingly to say, the potential in our technology, as a platform for creating customer value, is one of these areas. This is confirmed again and again in the activities we are engaged in, together with our partners, in order to reach the market with our first volume products.

However, I have also noticed that there are a lot of areas where I am not at all pleased with our efforts so far, and these are the once we will focus on in the future.

The management team and I have, for the last two months, made a thorough analysis of the business. The work has been done from both a technical as well as a commercial perspective. We have reached a number of conclusions which will result in a number of changes within the company. In simple terms, the business so far has focused too much on the development of new molecules with exciting features and less on how these should be applied to create concrete customer value. The main changes that we are implementing is that we go:

  • from a slow, perennial, business development cycle, primarily focused towards research and development clients, to a faster, semi-long, business cycle, where we approach customers within the areas of conversion, compounding and recycling of plastic, i.e. we broaden our customer base by moving forward in the value chain.

  • from a laboratory operation, focused on developing new chemistry and new molecules, to a more concrete application development, focused on customer value and customer benefits.

  • from an organization where most of the resources work with development, to an organization where a significant part of the resources are allocated towards sales and application support. 

Now, we are building a small but skilled and motivated team with the capacity to drive Nexam Chemical’s commercialization process.

As a first step in this process, I am very pleased and satisfied to announce that Lars Öhrn has chosen to join us as our new CMO (Chief Marketing Officer). Lars brings to Nexam Chemical a solid marketing and sales experience from the plastic industry that we intend to address. He has held a number of senior roles both within polymer manufacturing and plastic processing companies. His most recent position was as Market Application Manager with Borouge in Abu Dhabi. Lars’ knowledge and insight of how to generate value for the customer and the in-depth knowledge of applications, contributes greatly to drive our efforts in the right direction.

Our NEXIMID® business develops positively within high-performance polymers, especially for polyimides. However, this is a relatively small market with limited volume and profitability potential. During the current year, we will put more resources into delivering a strong “proof of concept” with our technology in the prioritized high-volume segment. A first step is commercialization of applications within PE-pipes, and a variety of film and foam, based on PET, PE and PE.

We have also, in parallel with the re-focus towards market and sales, reviewed the company costs. Together with the management team I have initiated a cost reduction program, which significantly will reduce our costs already during this year.

As can be seen, and here I want to be clear, I think Nexam Chemical should have progressed further than we have in terms of commercialization of our technology. We have put too little emphasis on in-depth analysis and evaluation of our customer offers and have been unable to focus on the right market segment. Our sales efforts have been fragmented with activities on a far too low level. With this said, it is always easy to be wise after. To develop Nexam Chemical’s type of business takes time, longer time than we have earlier thought and communicated.

With this update, I hope to provide Nexam Chemical’s shareholders and business partners an up to date picture of where the company stands right now. Also, I want to emphasize that my first hundred days are over and now I have, together with the management team and the board, set a clear agenda and activity plan on how to go forward. Currently, we are working intensively in order to demonstrate to our customers and other stakeholders that, by using Nexam Chemical’s chemistry, it is possible to create significant customer value and also value for all of us having an interest in Nexam Chemical!

Anders Spetz
CEO

 

Note: This text has been translated from Swedish. The Swedish text shall govern for all purposes and prevail in case of any discrepancy with the English version.

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