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Groundwork is crucial to our job as investors. We recently travelled to Sweden to pay a visit to Smurfit Kappa’s cardboard production facility in Piteå as well as Europe’s largest open pit copper mine operated by Boliden in Aitik and SSAB’s steel mill in Luleå. An opportunity for our portfolio manager Arnaud d’Aligny, to confirm our conviction in Smurfit Kappa’s potential to create sustainable value. Insights.



  • Smurfit Kappa: the largest Kraftliner facility (cardboard) in Europe, with an annual capacity of 700,000 tons
  • Boliden: Europe’s largest open pit copper mine and one of the world’s most productive
  • SSAB: blast furnaces among Europe’s most modern, with an annual capacity of 2 million tons of steel


  • Keep these facilities among the most productive in their sectors: cardboard, copper, steel
  • Sustainably manage operations with strong interactions with the environment
  • Ensure a high degree of employee safety

For one of our on-site visits, we have headed to the far north of Europe, in Sweden, near the Arctic Circle. The point of this trip was to find out more about some of Smurfit Kappa’s and Boliden’s most important industrial facilities. The Irish group Smurfit Kappa is a world leader in corrugated cardboard packaging material and one of our fund Sycomore Sélection Responsable’s strongest convictions; Boliden is a Swedish mining group that mainly produces copper and zinc and which has previously been held in our fund Sycomore Eco Solutions. We also took advantage of this trip to visit one of the production facilities of the Swedish steelmaker SSAB as well as to meet with the Swedish iron ore maker LKAB.
The facilities of Smurfit Kappa, Boliden and SSAB surely operate in different sectors, but they do share some common features: all three ranks among the most productive in their respective fields; they operate in sectors with a heavy footprint on the environment and natural capital (transformation or extraction of raw materials) and are truly ambitious in terms of sustainable development and respect of their ecosystems; last, they are highly committed to the safety of their employees, often working in difficult surroundings.


Three Swedish facilities that are among the most productive in Europe in cardboard, copper and steel


Smurfit Kappa, a world leader in corrugated cardboard packaging material, owns Europe’s largest Kraftliner production facility in Piteå, that is to say, cardboard to be, in turn, transformed into packaging. Kraftliner is made from “virgin” wood fibres, unlike testliner, made from recycled fibres. The facility also houses one of Smurfit Kappa’s major R&D centres and a co-generation power plant that provides most of the energy requirements of the site and heating needs for the city of Piteå. The facility produces 700,000 tons of cardboard annually and generates SEK 4 billion in annual revenues with its 540 employees, making it Piteå’s first private employer.


Smurfit Kappa pays close attention to its impact on ecosystems and implements a truly circular economy model. First and foremost, it endeavours to preserve the natural capital by sourcing only from “FSC®” or “PEFC™” certified forests and by replanting two trees for each tree cut down in its wood-sourcing.
Furthermore, the facility's industrial process is highly energy- and water-intensive. That’s why not only the Group has installed a co-generation power plant that runs on biomass (i.e., the organic waste from production) but the site also recycles more than 90% of the water used (hence 33,000 m3 of water is recycled daily).
Finally, the firm keeps close watch on employee working conditions, with safety being its absolute priority. It also closely monitors air and sound pollutions and strives to reduce them, both in the facility but also in nearby residential areas.

Smurfit Kappa (…) implements a truly circular economy model


The site is impressive in its gigantic scale, with a pit that is 3 kilometres long, 1 kilometre wide, and almost 500 metres deep. The rocks are extracted, crushed, ground and concentrated 24/7 by teams from the site’s 600 employees. The mine produces almost 70,000 tons of copper each year, more than 60,000 tons of silver, and two tons of gold.


Boliden is renowned for its efficient and productive operations, and this mine appears as a good illustration: although the copper content of local rocks is relatively low (0.2% vs. 1.0-3.0% on average and up to 30% in DR Congo!), Aitik is one of the world most productive copper mines. This feat stems from the use of the most advanced extraction and processing methods, high standards in employee training, a corporate culture based on autonomy and responsibility, fostering a sense of initiative, and based on a flat hierarchy.
Management’s absolute priority is the safety of workers, exposed to operations that are risky at times (handling of explosives, possible landslides, etc.). Better protection equipments, safer machinery, greater transparency in procedures and an intensive automation have helped significantly reduce the occurrence of accidents in recent years.
Last, Boliden has already designed and funded a precise rehabilitation plan of the site to reconstitute a natural landscape of wet areas and foster biodiversity once mining operations will be completed (in several decades).

The absolute priority (…) is the safety of workers, exposed to operations that are risky at times

The facility of SSAB (Swedish Steel AB) in Luleå consists of blast furnaces and steel production site with an annual capacity of 2.3 million tons. The steel mill is strategically located near the iron ore mines of northern Sweden, where SSAB sources from LKAB, the mining group owned by the Swedish state. These blast furnaces are SSAB’s largest and rank now among Europe’s most modern after being renovated in 2015. They are particularly highly efficient in terms of CO2 emissions (7% better than the European steelmaking average).


We were impressed by the scope of the infrastructures, covering hundreds of hectares, and by the degree of automation of the production processes. The blast furnaces are constantly fed with iron ore, coke (coal) and additives to produce a liquid pig iron (iron that is still carbon-rich), which is then purified and whose carbon content is reduced to become steel. Alloys are then added, and the chemical composition is refined during the fine metallurgy stage to deliver 500 different qualities of steel, according to clients’ specifications. The resulting rectangular slabs can be as long as 11 metres and weigh 25 tons. More than 7000 tons of steel are shipped out each day by train.
In addition, SSAB appears to be a true pillar in the local community of Luleå, where it is the top employer, with its 1100 FTEs.

SSAB’s blast furnaces rank among the most productive and least CO2-polluting in Europe


Our visit to the Smurfit Kappa facility in Piteå reinforced our conviction regarding the Group’s potential to create sustainable value, being one of the main positions of our fund Sycomore Sélection Responsable.
Smurfit Kappa is one of the world leaders in packaging, mainly in corrugated cardboard, and enjoys relatively foreseeable and steady volume growth of +2-3% annually (more than 60% of its products are intended for the food and consumer staples industries, with a broad diversity of customers and countries). Its business model is sound and proven and has resulted in a high return on capital employed and a strong generation of cash-flows, which are redeployed in a disciplined way, both in organic investments and acquisitions to strengthen a still-fragmented market.
Smurfit Kappa also stands as a true player in the circular economy and seeks to create value for all its stakeholders, paying special attention to the environment and natural capital and scoring points with clients through its leadership in innovation.

A sound and attractive business model combined with a strong ambition in sustainable development

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This document is not to be construed as an offer or solicitation to buy or sell any financial instrument whatsoever. Specific securities and their issuers are referred to solely for purposes of illustration and such references must not be interpreted as recommendations to buy or sell such securities. This promotional document has not been produced in accordance with regulatory provisions on promoting the independence of financial research. Sycomore Asset Management is not subject to the ban on making transactions on the financial instruments concerned before or during the dissemination of this document.


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