AG Vision - Group_Newsletter 01/12/2009 13:10 Page 1

News from across the Ardagh Group

Issue 1 December 2009 www.ardaghglass.com

Production begins
Niall Wall, CEO for Heineken at new
Welcome to the first
Newsletter from Ardagh
Moerdijk Furnace
As you are aware, 2009 has been a Less than one year after the announcement of a new furnace at Moerdijk
difficult year for many businesses across in the Netherlands, dedicated to Heineken, beer bottles are rolling off the
the world. Europe was particularly production line. The new furnace, which doubles production at the plant,
affected by the global recession is close to one of Heineken’s main production centres.
including all the markets we operate
in and although our industry held up We, and colleagues from Heineken, are proud to welcome this
more than most, sales volumes have outstanding achievement, which significantly reduces the environmental
deteriorated. As a result we have had impact of the glass bottles which we produce for them. The furnace CO2
to make some difficult decisions with
emissions are reduced by 12%, energy usage is reduced by 13% and the
temporary line closures across the Group
and furnace closures in Bad Münder and
CO2 from road transportation is additionally reduced by 80%.
Obernkirchen. These actions were taken
with much thought and deliberation in The new furnace has the latest state of the art oxy-fuel fired technology,
order to allow the business to become significantly reducing emissions in compliance with future European
leaner and more efficient with the legislation.
intention of safeguarding employment
for the majority of our people. The Moerdijk project is a significant development, which consolidates
the long term partnership between Ardagh Glass and Heineken.
In April this year the Company
undertook a project called Project Sense,
with the aim of reducing costs by €70m
against the 2007 budget. All
stakeholders were involved and through
a combined effort we will achieve our
objectives, placing Ardagh at a
competitive advantage for 2010. We are supporting various Children’s
I would personally like to thank all Charities across Europe this Christmas
Ardagh employees for their support
in this project which will help us stay
competitive as the challenges for our
business continue into 2010. Your
continued support will ensure Ardagh
remains successful in the coming years
and develop its position as one of
Europe’s leading glass manufacturers.

I would also like to take this opportunity

to thank David Currie for the
outstanding contribution he has made to
the business in his various roles over the
years, most recently in the position of
Managing Director of Operations. I’m
sure you will join with me in offering
David our best wishes for his retirement.

Johan Gorter will now officially take

over the role of Managing Director of
Operations. His knowledge and
experience of the glass industry will be
a great asset to the Company going
forward. one brandone vision
AG Vision - Group_Newsletter 01/12/2009 13:10 Page 2
Operational Excellence Group (OEG)
Even if you are not already aware of the Company’s “Operational Excellence Group”
(OEG), all functions and regions are now benefitting from its work in some way.
“Converting ideas
into solutions through
combined technical
excellence”
When Ardagh Glass expanded into 7
countries we knew that there were
different cultures and ways of working, but
we also knew we had a wealth of technical
and practical knowledge in all our plants
and so needed to find a way of harnessing
this expertise and developing a “best
practice” programme.
The solution was to create a new group of
technical experts within the Company,
combining the knowledge of both plant
and group personnel. This cross functional
and cross regional team has now been fully
empowered to do what they do best - share
information and implement it ‘at the speed
of light’ once it has been proven to be
effective.
We recognised that we needed a two way
communications channel within each plant
to ensure that we are made aware of any
problem or issue that might need tackling,
and which would allow for solutions to be
implemented as smoothly as possible. We
therefore established an OEG representative
in each plant, to provide a key link with
the Group.
Business Processes & Systems
To support the ongoing development of Ardagh’s business we
have recognised the need to improve and integrate our systems.
I am delighted to report that OEG has been successful in both the results it has achieved
with specific projects, and in creating a more coherent best practice approach throughout
the Group. Here are some examples:
• Through focussed OEG plant reviews we have been able
to create a best practice protocol for forehearth set-up.
• Through OEG we have introduced a high-speed camera as a
very powerful problem solving tool. What in the past might
have taken years, was implemented in less than 3 months.
• We have also established best practice programmes in the
vital areas of quality checks, critical defect reduction,
inspection equipment and customer services. Customer
critical defect complaints have been reduced by 75% as a
direct result of this initiative.
• Through sub-groups we have been able to optimise cooling
fans and establish a best practice maintenance plan.
Through the OEG, we are far more focused on quality risk management and customer
needs. We are moving towards a standardised approach that provides us with the
fastest know-how transfer so that quality can be reproduced throughout the Company.
Above all, there is now a very effective channel for communicating cost saving and
quality improving ideas and suggestions.
Johan Gorter - Managing Director European Operations
To this end, a formal structure to ensure Ardagh’s
business processes and systems are controlled has
been introduced to enhance the work of the SCC
(SAP Competence Centre) and Key Users.
The SCC will change its name to the BST (Business
Systems Team) and together with the BPT (Business
Processes Team) made up of Group Key Users will
be responsible for ensuring process and system
development fits with the requirements of the
business. Specifically, the coordination and
development of the key business systems (SAP,
MERA and BW), together with integration to APS
and iShare will become the responsibility of the
BST and BPT teams under the guidance of a
Steering Group.
These improvements will ensure the requirements
of Sales, Planning, Finance, Operations, HR and
the Supply Chain are optimised and met in the
most cost-effective way. To help this process
succeed, knowledge sharing across the Group
will be a priority as well as communication and
collaboration across all regions.
Michael Kennedy - CFO Operations
AG Vision - Group_Newsletter 01/12/2009 13:10 Page 3

In Germany, as half of all finished products are collected by

The importance of our customers, we have developed a highly effective “reverse
logistics” scheme. Deliveries to customers are synchronised with
collections at the plant to significantly reduce mileage and thus the
Corporate Social carbon and noise impact of transportation. A similar arrangement is
now being operated by our hauliers to keep empty return journeys
to a minimum. This approach is also being adopted throughout the
Responsibility (CSR) Company.

to Ardagh Glass In the Netherlands we sponsor the "Roparun" in May each

"Corporate Social Responsibility is the continuing
commitment by business to behave ethically and
contribute to economic development while
improving the quality of life of the workforce
and their families as well as of the local community
and society at large"
(World Business Council for Sustainable Development)
As a Company, we are increasingly being asked by our customers
to state our policies towards Corporate Social Responsibility.
CSR has become a major issue, as far as both the environment
and the way we treat all our stakeholders is concerned.
year. This is a long distance running competition in which teams
run the 530 kilometres from Paris to Rotterdam in aid of young cancer
patients.
We run a very active community programme in Poland, where
recent initiatives have included sponsoring a theatre group
performance for hospitalised children, supporting a local kindergarten
and creating a foundation for the disabled.
At Ardagh’s Limmared factory in Sweden, scholarships are
awarded to local students who achieve outstanding exam
results. There is also a scheme to provide low carbon energy to the
local community and Ardagh is involved in the national “Keep
Sweden Tidy” campaign.

At both Group and Plant level, Ardagh supports a wide range

of community and regional based events and initiatives - ranging
from sports and environmental, cultural and educational, to
various charities. Here are some examples.
Support for education features highly on Ardagh’s CSR priority
list. The German and Dutch plants also work closely with local
schools at all levels, supporting events, facilitating works visits,
sponsoring anniversaries and mentoring projects.

Through Dublin Head Office we have supported the Peter

McVerry Trust for Homeless Children through sponsorship of a
cycle team in the recent “Welcome Home” 150 kilometres cycle race
“How we relate to our neighbours,
from Dublin to Wexford. our communities, our employees and
the environment are all embedded in
In the UK an annual schools design competition based around our core values and feature prominently
recycling is sponsored by Wheatley and from Portland in Scotland in Company training programs at
we sponsor one of the main regional football competitions, the Ardagh
League Cup. Football is very important to many of the towns and
group and local levels.”
villages around the factory in Irvine, where long term sponsorship
has benefited thousands of players, their families and supporters. Monika Markowska - Group HR Director, Poland

A focus on sustainability – Trendtag Glas 2009

This year’s Trendtag Glas Conference, the main event in the German
glass making calendar held in Hamburg in October, focused on the
sustainability of glass as a packaging material.

A host of high profile speakers from the industry as well as from the world
of science and technology highlighted the merits of glass as the packaging
material of the future in a world where environmental concerns are
becoming top of the agenda for businesses and brands. The conference
also acknowledged that as well as being perceived by consumers as a
highly sustainable material, glass also offered innovative solutions for
businesses evaluating their credentials in the area of sustainability.
AG Vision - Group_Newsletter 01/12/2009 13:10 Page 4
How glass is able
to measure the
whole iceberg
As you read this article, people all over the world
will be reflecting on the Copenhagen Climate Change
Conference of December, involving 180 countries.
Will the challenge of finding ways to
reduce greenhouse gas emissions to
manageable levels and avoid raising
global temperatures be met?
We shall find out
soon enough!
The glass industry has always taken a pro-active
approach towards the environment. Some regions have
been running recycling programmes for over 30 years
and have made significant progress in container
lightweighting, in some cases halving weights over the
past 20 years.
The European Glass Container Association – FEVE,
alongside its USA equivalent the Glass Packaging
Institute, is currently compiling a Life Cycle Analysis
(LCA). This further demonstrates the industry’s
commitment to understanding and reducing our
environmental impact.
This LCA study takes a ‘cradle to cradle’ approach which
measures not just the environmental impact of the
material up to the factory gate, but continues up to the
‘end of life’ or waste phase. Because it has used data
from 200 glass furnaces and was independently verified,
it is the most credible and comprehensive assessment
ever conducted across all packaging industries.
A good way to describe our approach is to use the
metaphor of an Iceberg. Other materials measure
themselves against the visible part of the iceberg
(ie, by excluding the waste phase) and ignore what
is under the water. The new LCA data for glass
considers the full picture.
LCA is a complex subject, but thanks to this study the
glass industry is gaining credibility. The results help us to
fully understand our impact and target real reductions.
As an industry we are developing strong messages to
counter unfair comparisons with other materials and
support our industry going forward.
Steffen Seehausen - Head of Group Physical Risk Management
Thousands of people
throughout Europe have
positive things to say
about glass...
So, in 2008, FEVE, the European Glass
Container Association, (www.feve.org)
announced the launch of a new campaign
called “Friends of Glass”.
The aim of Friends of Glass is to promote the benefits of glass
packaging directly to consumers using modern communication
techniques such as blogging and social networking (eg, Facebook
& Twitter). It is a “word of mouth” movement designed to engage
consumers and promote the sustainability, health and functional
benefits that glass has over other materials.
We are facing increasing competition from other packaging
materials so it’s both a timely and positive step for our industry to
act together in securing a positive future for glass packaging. The
campaign has completed its first phase across Europe with the
staging of “Choose Glass Week” in September.
Images from ‘Choose Glass Week, Brussels’
Results to date have been good with an
estimated coverage of over 20 million European
consumers. This includes over half a million
viewings of a viral video starring HANK
‘The Singing Bottle’ (www.friendsofglass.com).
Sharon Crayton - Head of Group Marketing
Managing an uncertain market
As we reach the end of 2009 demand for glass packaging
in Europe is expected to be down 6%. However, due to
the economic downturn this was something Ardagh
anticipated early in the year and we took appropriate
measures at the start of the cycle to adjust our stock levels
and costs. As a result, the Company is in better shape to
move forward and take advantage of any economic
rebound that is predicted for 2010.
The good news is that we have already secured contracts
for more than half our 2010 sales target, including long
term contracts with key customers such as Heineken,
Absolut and ABInBev.
We must expect that next year customers will be able
to take advantage of a competitive market for glass
packaging. However, the long-term relationships we enjoy
with many customers, our strong and experienced sales
team, and the flexibility we now have across the whole
business will ensure this is carefully managed.
Reiner Brand - Group Sales & Marketing Director