SECOS’s proprietary resins used in responsible packaging

In a strategically important development, sustainable and eco-friendly bioplastics developer SECOS Group Ltd’s (ASX:SES) proprietary Cardia Bioplastics Compostable Resins have been used by a major South African packaging company to produce high-quality compostable bunch carry bags and carton liners as alternatives to single use plastics.

SECOS’s Cardia BF04 Resins are FDA (US Food and Drug Administration) compliant and safe for food contact applications, and its Cardia Resins are also certified compostable to AS4736, EN13432 and other international standards.

The new range of environmental products commonly used in the delivery of food products including grape bags and other fruit box liner products replaces single use plastics for food handling.

SECOS has received small quantity commercial orders and management is expecting demand to grow as sales of the product range expands.

Accelerated transition to responsible packaging

The packaging company is Superior Packaging Industries which has a prominent position in the South African plastics conversion industry, with the group producing film products which it prints, slits and laminates.

More recently, Superior Packaging has explored the domestic and export markets with its US range of fully compostable products with target markets in the food space being dairy, produce, food manufacturers and bakeries.

Highlighting the attractive characteristics of SECOS’s resins, Superior Packaging operations manager, Mark Williams said, “Cardia’s compostable resins met our strict requirements that ensure our products are made from renewable plant-based materials, are food safe and certified as such by US Food and Drug Administration and Din Certco certified as biodegradable and compostable as per EN13432 using only non-GMO certified raw materials.”

Underlining the increasing transition to responsible packaging, SECOS director of sales, Stephen Walters said, “It’s been very exciting working with Superior Packaging on the development of their new range of environmentally friendly products.

“Developments such as this show how innovative packaging companies can use Cardia resins to provide greater choice to their customers and support the shift to responsible environmental packaging solutions”

From a strategic perspective this is a particularly important development as food grade packaging has been identified as one of the company’s key markets and management expect further applications in this area.

Restructuring to result in improved earnings quality

SECOS holds a strong patent portfolio and the global trend toward sustainable packaging is fuelling the company’s growth.

The group’s headquarters and Global Application Development Centre are based in Melbourne, Australia, but SECOS also has a Product Development Centre and manufacturing plant for resins and finished products in Nanjing, China, with manufacturing plants for high quality cast films in Malaysia.

Recent group restructuring has resulted in improved manufacturing efficiencies and significant cost reductions for SECOS, translating into higher margins which could well see earnings growth proportionately outstrip the increases in revenues which should stem from increased product demand.