Executive Outlook
ARC International
ĂĚǀĂŶĐĞŵĞŶƚŽĨĚŝŐŝƚĂůƉƌŝŶƟŶŐĨŽƌŚŝŐŚͲŐƌĂƉŚŝĐĂŶĚ ƐŚŽƌƚĞƌƌƵŶŶĞĞĚƐ͕ƚŚĞŇĞdžŽŐƌĂƉŚŝĐŝŶĚƵƐƚƌLJŝƐƐƵƌĞƚŽ ĐŽŶƟŶƵĞƚŚƌŝǀŝŶŐ͘ĞĐĂƵƐĞƚŚĞĂŶŝůŽdžƌŽůůĞƌŝƐƐƟůůƚŚĞ ŚĞĂƌƚŽĨƚŚĞŇĞdžŽƉƌĞƐƐ͕ZŐƌĂƉŚŝĐƐƉĞĐŝĂůŝƐƚƐǁŽƌŬ closely with printers to ensure that the proper en- graving technology is employed to achieve the most ĐŽŶƐŝƐƚĞŶƚƉƌŝŶƚƋƵĂůŝƚLJ͘tŚŝůĞƚƌĂĚŝƟŽŶĂůϲϬͲĚĞŐƌĞĞ ŚĞdžĂŐŽŶĂů ĐĞůůƐ ĂƌĞ ƐƟůů ƚŚĞ ĐŚŽŝĐĞ ŽĨ ƉƌŝŶƚĞƌƐ ĨŽƌ higher graphics and process work, extended hexag- ŽŶĂů ĐĞůůƐ ŽīĞƌ ĞdžĐĞƉƟŽŶĂů ƌĞůĞĂƐĞ ĂŶĚ ŐƌĞĂƚĞƌ ĐŽů - or density for line and solid work. In order for anilox ƌŽůůĞƌƐƚŽĐŽŶƟŶƵĞ ƚŽďĞƩĞƌŵĂŝŶƚĂŝŶ ĐŽůŽƌĚĞŶƐŝƚLJ͕ ZŚĂƐďĞŐƵŶǁŽƌŬŝŶŐĐůŽƐĞůLJǁŝƚŚ ĸĐŝĞŶƚŶŝůŽdž Care, LLC to provide cleaning plates which mount to ƚŚĞƉƌŝŶƚĐLJůŝŶĚĞƌƚŽĐůĞĂŶĂĐŽůŽƌƐƚĂƟŽŶƚŚĂƚ͛ƐŶŽƚŝŶ ƵƐĞǁŚŝůĞ ƚŚĞ ŽƚŚĞƌƐ ĂƌĞ ŽƉĞƌĂƟŽŶĂů͊ ŶĚǁŚĞƚŚĞƌ ƚŚĞŇĞdžŽŽƉĞƌĂƚŽƌŝƐƉƌŝŶƟŶŐŽŶĂŚŝŐŚůLJĂďƐŽƌďĞŶƚ ŵĞĚŝƵŵ Žƌ Ă ĐŽĂƚĞĚ͕ŵŝĐƌŽͲŇƵƚĞĚ ďŽĂƌĚ ĨŽƌ ŚŝŐŚĞƌ ŐƌĂƉŚŝĐƐ͕ZĞŵƉůŽLJƐƉƌĞŵŝƵŵĞůĂƐƚŽŵĞƌŝĐŵĂƚĞƌŝ - ĂůƐŽŶĨĞĞĚƐĞĐƟŽŶƌŽůůĞƌƐƚŽĞŶƐƵƌĞƚŚĂƚďŽĂƌĚĐƌƵƐŚ ǁŝůůŶŽƚĂīĞĐƚƉƌŝŶƚƋƵĂůŝƚLJ͘ dŚĞ ĐŽĂƟŶŐ ĂŶĚ ůĂŵŝŶĂƟŶŐ ŽĨ ƉĂƉĞƌ ĂŶĚ Įůŵ ŝƐ ŽŌĞŶ ĂĐŚŝĞǀĞĚ ƵƐŝŶŐ ŵĞĐŚĂŶŝĐĂůůLJͲĞŶŐƌĂǀĞĚ ĂŶĚ chrome plated rollers. Unfortunately, the chrome ƉůĂƟŶŐ ŝƐ ǀĞƌLJ ƚŚŝŶ ;͘ϬϬϬϰ͟ ƚŽ ͘ϬϬϬϲ͟Ϳ ǁŚŝĐŚ ŽŌĞŶ leads to rust and corrosion on the roller surface. This ĂīĞĐƚƐĐŽĂƚǁĞŝŐŚƚĂŶĚůĂLJĚŽǁŶ͘ZŽīĞƌƐĐůĂĚĚĞĚ stainless-steel rollers that eliminate the need for a ĮŶĂů ĐŚƌŽŵĞ ƉůĂƟŶŐ͕ ƚŚƵƐ ĞdžƚĞŶĚŝŶŐ ƌŽůůĞƌ ůŝĨĞǁŝƚŚ ĐŽŶƐŝƐƚĞŶƚĂƉƉůŝĐĂƟŽŶƐ͘ But perhaps the most important investment that Z /ŶƚĞƌŶĂƟŽŶĂůŵĂŬĞƐ ŝƐ ŝŶ ͞ƉĞŽƉůĞ͘͟ /Ŷ ŽƌĚĞƌ ƚŽ ŐƵĂƌĂŶƚĞĞƚŚĂƚŽƵƌŵĂŶƵĨĂĐƚƵƌŝŶŐĨĂĐŝůŝƟĞƐ ŝŶŚĂƌ - ůŽƩĞ͕E ĂŶĚ >ĂƐsĞŐĂƐ͕Esǁŝůů ĐŽŶƟŶƵĞ ƚŽ ƐƵƉƉůLJ ŽƵƌĐƵƐƚŽŵĞƌƐǁĞůůŝŶƚŽƚŚĞĨƵƚƵƌĞ͕ZŚĂƐŚŝƌĞĚŶŽƚ ŽŶůLJƐĞĂƐŽŶĞĚǀĞƚĞƌĂŶƐĨƌŽŵƚŚĞŇĞdžŽŐƌĂƉŚŝĐŝŶĚƵƐ - try, but also select entry level personnel whom the ĞdžƉĞƌŝĞŶĐĞĚƚĞĐŚŶŝĐĂůƐƚĂīĐĂŶŵĞŶƚŽƌ͘ Packaging plays a major role in each of our daily ůŝǀĞƐ͊Z/ŶƚĞƌŶĂƟŽŶĂůŝƐƉƌŽƵĚƚŽŚĂǀĞďĞĞŶĂƉĂƌƚ ŽĨƚŚŝƐŝŶĚƵƐƚƌLJĨŽƌƚŚŝƌƚLJͲĮǀĞLJĞĂƌƐĂŶĚǁĞůŽŽŬĨŽƌ - ǁĂƌĚƚŽƐƵƉƉůLJŝŶŐĂŶĚƐĞƌǀŝĐŝŶŐŽƵƌŇĞdžŽŐƌĂƉŚŝĐĐƵƐ - ƚŽŵĞƌƐĨŽƌŵĂŶLJLJĞĂƌƐƚŽĐŽŵĞ͊
Mike Foran President & CEO
As we celebrate our 35th year of manufacturing at Z/ŶƚĞƌŶĂƟŽŶĂů͕ǁĞĐŽŶƟŶƵĞƚŽƐĞĞŐƌŽǁƚŚŽƉƉŽƌ - ƚƵŶŝƟĞƐŝŶĂůůƚŚĞŝŶĚƵƐƚƌŝĞƐƚŚĂƚǁĞƐĞƌǀĞͶŶĂƌƌŽǁ ĂŶĚǁŝĚĞǁĞďƉĂƉĞƌ͕ĮůŵĂŶĚĨŽŝů͕ĐŽĂƟŶŐĂŶĚůĂŵ - ŝŶĂƟŶŐ͕ ĂŶĚ ĐŽƌƌƵŐĂƚĞĚ ƉĂĐŬĂŐŝŶŐ͘ tĞ͛ǀĞ ĐŽŶƟŶ - ƵĞĚƚŽŝŶǀĞƐƚŝŶƚŚĞůĂƚĞƐƚĮďĞƌŽƉƟĐůĂƐĞƌĞŶŐƌĂǀŝŶŐ equipment, which provides the most consistent ink ĚĞůŝǀĞƌLJĨƌŽŵŚŝŐŚͲĚĞĮŶŝƟŽŶĂŶŝůŽdžƌŽůůĞƌƐ͕ĂƐǁĞůůĂƐ ŝŶƉƌĞĐŝƐŝŽŶŐƌŝŶĚŝŶŐĞƋƵŝƉŵĞŶƚ͕ĂĐŚŝĞǀŝŶŐƚŚĞƟŐŚƚ tolerances that are demanded today. And the propri- ĞƚĂƌLJĐĞƌĂŵŝĐĐŽĂƟŶŐƐƚŚĂƚĂƌĞĨĞĂƚƵƌĞĚŽŶŽƵƌƌŽůů - ers ensure that they deliver maximum durability and extended roller life to our customers. KƵƌEŝĐŬĞůĂĐŬΡƐůĞĞǀĞĚŝǀŝƐŝŽŶĐŽŶƟŶƵĞƐƚŽŐƌŽǁ͕ especially our NBA NickelBack™ anilox sleeves. The inner nickel layer requires less air pressure to mount ĂŶĚƌĞŵŽǀĞƚŚĂŶĐŽŶǀĞŶƟŽŶĂůƐůĞĞǀĞƐǁŝƚŚĮďĞƌŐůĂƐƐ inner layers. This ensures a safer pressroom environ- ŵĞŶƚ͘ŶĚǁŚŝůĞĮďĞƌŐůĂƐƐŝŶŶĞƌůĂLJĞƌƐĂƌĞƉƌŽŶĞƚŽ ĐƌĂĐŬ ĂŶĚ ĐŚŝƉ ŽǀĞƌ ƟŵĞ ĨƌŽŵ ŵƵůƟƉůĞ ŵŽƵŶƟŶŐƐ ĂŶĚĚŝƐͲŵŽƵŶƟŶŐƐ͕ƚŚĞŶŝĐŬĞůŝŶŶĞƌůĂLJĞƌďĞƩĞƌĂď - sorbs those processes, giving the sleeve a longer life. ZƵďďĞƌ ƟŶƚ ƐůĞĞǀĞƐ͕ ĞdžƚĞŶĚĞƌ ƐůĞĞǀĞƐ ĨŽƌ ĂĚĚĞĚ ƌĞ - ƉĞĂƚƐ͕ ĂŶĚ ŶĂŬĞĚ ŶŝĐŬĞů ƐůĞĞǀĞƐ ĨŽƌ ƉůĂƚĞŵŽƵŶƟŶŐ have also made an impact on growth. ŽŶǀĞŶƟŽŶĂů ĂůƵŵŝŶƵŵ ĚŽĐƚŽƌ ďůĂĚĞ ĐŚĂŵďĞƌƐ ŚĂǀĞĂůǁĂLJƐďĞĞŶƉƌŽŶĞƚŽĨĂŝůŽǀĞƌƟŵĞ͘Z/ŶƚĞƌŶĂ - ƟŽŶĂůŚĂƐĂůŝŐŶĞĚŝƚƐĞůĨǁŝƚŚWĂĐŬĂŐŝŶŐWůĂƐƚĨƌŽŵ/ƚĂůLJ to provide the lightest and most durable 100% carbon ĮďĞƌďůĂĚĞĐŚĂŵďĞƌƐŝŶƚŚĞŵĂƌŬĞƚƉůĂĐĞ͘ƐǁĞůů͕ŽƵƌ seasoned technical personnel have years of experi- ĞŶĐĞŝŶƐƉĞĐƟŶŐĂŶĚŝŶƐƚĂůůŝŶŐĚŽĐƚŽƌďůĂĚĞĐŚĂŵďĞƌƐ͘ With theworldwideexpansionof Amazon™andoth- er online shopping agencies, the corrugated industry ĐŽŶƟŶƵĞƐƚŽƐĞĞŐƌŽǁƚŚŽƉƉŽƌƚƵŶŝƟĞƐ͘ ǀĞŶǁŝƚŚƚŚĞ
4 Executive Outlook Special Report
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