Mr Stenham told the annual meeting that the company's Sainte Marie coated paper mill in France and a production site at Ettlingen, Germany, would be shut due to massive overcapacity in the industry. In addition, the company planned to cut up to 100 jobs in Belgium to restore margins.
Mr Stenham warned that trading conditions were likely to remain depressed for another two years due to further increases in capacity, while demand had remained weak.
'This has put intense pressure on prices and margins and sharply reduced the profitability of the sector,' he said. He admitted that the company had not fully appreciated the seriousness of the downturn until late last year, but said it had acted quickly since then to cut costs.
The meeting also heard one shareholder criticise Arjo's policy of granting three-year rolling service contracts to directors. Frank Williams, a private investor, said the company should not pay more than one year's compensation to any director who had been dismissed or forced to step down. He also demanded that the annual report should identify the exact pay of each director.
The company paid Stephen Walls, who was forced to step down as chief executive, pounds 775,000 compensation for loss of office last year.Reuse content