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Road Marking business area / PlastiroutePlastirouteEco-friendly road-marking productsoffer advantages on highly competitive marketsHead office: Müllheim, GermanyMD: Karsten VeltmannTurnover 2007: SKr 124(118) million (excluding associatecompanies)Number of employees: 31 (31)Products: Paints and 2-componentproducts for road marking andaerosols sprays.Markets: Central EuropeCompetitors: Limburger Lack,Basler Lack, Rembrandtin,Signature, Veluvine, Color andTriflex.Share ofbusiness area’s turnover2-componentpaints 40%6%Revenue by productOther 10%Premark ® 1%Glassbeads7%Solventbasedpaints 31%Waterbasedpaints11%Nature of businessWith more than 50 years of experiencefrom the development, manufactureand sale of road-marking products,Plastiroute has an extensive exportbusiness and a strong market positionin Central Europe. Plastiroute GmbH,Germany, is the centre for productdevelopment, production andmarketing. Plastiroute SA, Switzer -land, is the sales organisation forSwitzerland and other export markets.Plastiroute manufactures andmarkets a complete range of waterandsolvent-based road-markingpaints, 2-component systems forhorizontal road marking and anextensive range of marking paints forairports. Plastiroute has no contractroad-marking activities of its own,but participates selectively in tendersin Germany and provides roadmarkingservices in association withpartners. Plastiroute’s own mechanicalequipment is mainly used fortesting new road-marking systems.MarketsThe German market continues to becharacterised by stiff competition,which has put pressure on the pricesof material suppliers. By contrast,growth rates have risen on exportmarkets. Synergies with other companiesin the Geveko Group havestrengthened Plastiroute’s positionon most of its markets in Europe.Two-component materials have continuedto sell well, and demand forsolvent-based paints has remainedstable. Despite further intensificationof marketing activities and regularproduct development of water-basedroad-marking systems, the Germanmarket remains unreceptive to ecofriendlyproducts.In Switzerland, on the otherhand, water-based road-markingsystems and 2-component systemshave replaced solvent-based paints,which benefits Plastiroute, which iswell to the fore in eco-friendly roadmarkingproducts and systems.Plastiroute is one of the leadingcompanies on the German market.Plastiroute’s customers primarilyconsist of contractors serving thepublic sector in the federal states inGermany and the cantons inSwitzerland.In recent years the Germaneconomy has been plagued by weakgrowth, whereas the market inSwitzerland has remained buoyant.Despite fierce price competition,Plastiroute has maintained its marketposition in Germany and strengthenedits position in Switzerland.On both the German and the Swissmarkets there are numerous suppliers,both large and small, among themLimburger Lack, Basler Lack,Rembrandtin and Triflex.Exports to Central Europe aregrowing steadily, and in 2007 theyaccounted for 50% of Plastiroute’sturnover. Plastiroute’s aim is to furtherstrengthen its position inHungary, Romania, the CzechRepublic, Poland and Turkey. Inseveral of these countries Plastirouteoperates in association with its associatecompany Cleanosol. In WesternEurope the markets in the Nether -lands, Belgium and France are ofparticular interest. In these countriesinterest in 2- and 3-componentpaints in particular is growing.Outlook for 2008The German market will remaintight on account of public spendingconstraints and excess capacity forproduct systems as well as amongroad-marking contractors. Contrac -tors are generally in a weak positionand the market is dominated by twolarge groups of companies. In 2007the leading company on the Germanmarket for road-marking productsacquired the largest German roadmarkingcontractor. This was the firsttime that a manufacturer becameshareholder in a large contractor.Plastiroute is ready to deal with theconsequences of this acquisition.Plastiroute intends to continue toparticipate in tenders in 2008 as ameans of enabling it to sell in itsnew product systems on the marketthereby avoiding becoming dependenton major customers.30