Nicolas Mockett (pic), head of packaging M&A, Moorgate Capital
Yes. Our clients are increasing the tempo on M&A, seeking more packaging acquisitions in UK, Europe, America and emerging markets. This is a signal that they are more confident of the performance of their organisations and having cash flow to invest in significant growth. They are frequently entering new territories because their existing customer base is also growing into new regions and furthermore the packaging companies are winning new customers in new countries. But caution is always prudent.
David Howlett, strategic planning director, MMR Research
Yes. We are sensing a growing confidence among major brand owners which has been gradually improving since summer 2013. It’s not yet translating into immediate investment, but the direction is set. MMR conducted a survey on post recession attitudes in 2013 called “The New Normal”. The title says it all. Things are better but we have a new set of expectations to deal with. People aim for “value” at every pricepoint. Higher prices can be afforded for a premium brand – but the extra cost has to be justified.
Rick Smith, chief finance officer, Chesapeake
It’s not really a ‘yes/no’ answer. One of our markets, spirits, is driven by exports so is less of a reflection of the wider UK economic growth. The pharmacuetical market develops and grows in line with demographics. In food and confectionery, it is growing in line with historical trends. We are not seeing any particular increase in activity on the back of the recent improvement in UK GDP. In the future, if you look at bank lending and raising debt, then the picture is much improved compared to a couple of years ago. Now there is debt available for acquisitions.
Paul Jenkins, co-founder, The PackHub
Yes. We are definitely experiencing more positive sentiment about the economic outlook with the packaging and brand owners we work with. It has been a very gradual and slow process. Proof of this confidence is perhaps in a number of packaging innovation projects that we are currently working on that had previously been shelved. The businesses that will do well are the ones that ensure that their innovation pipeline was filled despite difficult economic conditions. We are optimistic that 2014 and beyond will be a good period of activity.