Graphic PLC…Are the Rumors True?

Estimated reading time: 11 minutes

Matties: There's a difference though, from then to now. Now you're an investor, you're jointly an investor in the holding company that has interest in both. Now your interest is much stronger in the performance of Somacis as theirs is in the performance of Graphic, because they're tied to it from an equity basis.

Rozario: Yes, we had the same issue before of competition, because we had to supply DSG with orders. In a way, the competitiveness is still there, it's not the same company, and it's not one company. We work differently in our styles and our technology. That'll still run, we have to, because we're in a very competitive market. If I was a customer, and I had a large purchasing department, I could really look at reducing all that because I could come to one source, one company, and really get the same quality and approvals. As you talked about before, if you take Graphic as the most approached company, in comparison to our competitors, they're getting a quality product. If the pricing is right, we have to be.

If you look at our customer base, they are all the big names in the industry. You must ask the question: Why are they coming to us?

Matties: There's no doubt that Graphic is a high-end company, and the evidence is the number of supplier of the year awards and things like that, and the impressive customer list.

Rozario: And in China, like Honeywell, we were Supplier of the Year worldwide.

Matties: That's great; so your position is the same. You're still going to be showing up and working every day and steering the company. In terms of the customer's point of view, it's all the same, the names of facilities and each company will remain autonomous.

Rozario: My position obviously is with the holding company, and from that point of view, I was chairman here before, but obviously I'm now the director and shareholder of the major company, but the interests are still the same.

Matties: And your title here?

Rozario: It will just carry on as before.

Matties: Last year we looked at the expansion, which you mentioned a little earlier. You're well underway here with some expansion. Tell me more about what you're doing here, with the expansion, and the purpose behind that?

Rozario: To start, we have to look at plating is—a very important part in our industry. We have extended what we have and now we have to find space for the new technology we are putting in, advanced pulse plating and so forth. We need large areas for that. The effluent plant is built underground here, so we can go further afield. We need to expand all those departments. We're looking at new technology, and new technology needs space, and suddenly you find that you're one on top of the other. Obviously, from the customer's point, the capacity is getting a bit tighter now, so if you're looking at the next 10 years, we've got to plan for it now, which we're doing.

Matties: How will the new holding company allocate resources to the factories? If you're autonomous, and the money's coming from there obviously, there's going to have to be some justification.

Rozario: As you look around now, and the same for when you visited in China, each company has a budget and a spending budget as well for what's required. From that point of view, we already have got those, and we already know what's going to be spent here.

Every company has an investment budget. From that point, those are all being adhered to and looked at. It's nothing to do with capacity. The whole purpose is for the future and our standing in the global marketplace, and to be there to survive it’s something we have to do it. It would have been easy for me just to sit back, sit on my butt or play golf all day, but I don't. I’ve built this thing. I think it's in your blood, and you've just got to carry on, and we've got this stream of followers as well.

Matties: The directors will approve, and obviously they're looking out for the team, which you're a part of, and looking for ROIs.

Rozario: We obviously have a future here. For instance, we’ve got the holding company, which we are, and then the whole group situation, with Giovanni Tridenti, who is going to be the CEO, and David Pike as managing director and the rest of the people are the same. From a customer's point of view, their contact point, all those people are the same people. Nothing's changed, but we hope that we'll be in a better position to give better service, maintain our qualities, and also be very competitive.

Matties: What sort of dollars do you expect to have to invest into the organization to grow it to the levels that you hope to achieve?

Rozario: You're looking at overall? The buildings here for instance are owned by my building company as well, so that cash comes in for the building company. We have a 10-year lease here, so that won't be cost involved in our present situation, but because of our relationship with all our present suppliers and so forth, from their point of view, when anything new comes in, we are fortunate because we at least get a first look into it. It's hard to actually put a number to it, it's like an ongoing thing, and each company has put in several millions towards the investment. It also is depending on the trends, when you’re in too high we need it quickly, otherwise there's a time factor. As far as the overall spend, I don't want to put a guess to it until everything we do is actually worked out. I haven't got that figure in front of me yet.Page 2 of 3

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