Xaar Share Discussion Threads

[tongosti] 17/9/2015 16:15

Have you gone through Xaar's annual reports? You should be able to find the answers to your questions there, I would think.

[celeritas] 17/9/2015 16:03

I like these, can anyone expand on expected revenue.
phtm have more cash, better eps, much better yield plus a huge mkt of 87m new id's next year in Japan.
I compare the two but phtm always wins. Can anyone pick out a huge driver for xar?

[tongosti] 17/9/2015 08:52

Reason I asked was to see how - in case you would - you calculate "get in" and "get out" price levels. I now understand you don't have "get out" levels worked out but only the "get in" levels based purely on price and gut feeling. Whatever works for you!

[verger] 17/9/2015 08:07

475p would be even better.

[tongosti] 16/9/2015 22:32

Why £5 was a better price - do you think about 5% price differential makes a such a big difference for you?

[verger] 16/9/2015 13:17

Direct-to-shape printing is not a new subject. I kind of remember XAAR mentioning it some time ago as the next step. Yes, very lucrative. The big question is what is the right price for buying. I am surprised at the recent surge. I would have thought nearer £5 was a better price. I will wait and see. If it romps away I will be content with what I have already made out of this company, having originally bought at 180p. If it retraces I will buy more. One way or another this is a good company.

[dozey1] 15/9/2015 17:46

Saw today's rise and thought I would tap into the brains here to see what gives. Glad I did. Finger rapidly withdrawn from sell button.
Tks for great research.

[tongosti] 15/9/2015 16:32

Wow - this is what I call a break out

[tongosti] 14/9/2015 10:28

Useful indeed

[jaws6] 14/9/2015 09:38

rivaldo
Thanks for link and good info.

[rivaldo] 14/9/2015 09:28

Excellent new article about the prospects for XAR. Lots to talk about, but here's just one small extract:



"He’s also hoping that Xaar can tap into another potentially enormous market – direct-to-shape printing. If big brands follow the example of Belgium’s Martens Brouwerij, this could be huge. “Just a few percent would be bigger than ceramics,” Edwards says. “Market adoption will be driven by brands, and they are starting to see it as viable.”"

[mellorscarthwaite] 04/9/2015 13:24

Brewing in Belgium: KHS & Martens Brouwerij Ramp Up ‘Direct-to-Shape’ Printing
Bob Leahey
Aug 19, 2015
Color digital printing for packaging got a boost in Europe recently when a brewer long known for innovation, Martens Brouwerij (Belgium) publicized its use of a direct-to-shape print system to print PET bottles in full color, starting in June 2015. Called “Direct Print Powered by KHS™”, the system is engineered and built by KHS (Germany), a global supplier of filling and packaging solutions to the drinks industry, and commercialized by a wholly-owned KHS subsidiary, NMP Systems. The system, based on Xaar 1002 heads, uses low-migration inkjet inks from Agfa (Belgium) to print color images in CMYK +W in high resolution (1080 dpi, optical) at the rate of up to 12,000 bottles per hour. Images up to 70 mm (2.75”) are possible on bottles up to 120mm (4.75”) in diameter.

In effect, the new system offers late stage, full color decoration, at production level speeds, and thus big benefits in terms of timeliness and customization. Martens, which also has a brewery in China and partnerships internationally, has undertaken a project in its home country that embodies the real newness of what’s possible, through an intriguing use of augmented reality. To explain, each Martens beer bottle is printed with the image of one character from a popular Belgian TV show, F.C. Kampioenen. For a consumer with a smart phone, the bottles can connect to digital content, to promote an upcoming film based on the TV show: Scan the picture on a bottle and see the character talk to you on your smart phone; scan two bottles and see the two characters talk to each other; dozens of related video clips are available.




Direct-to-Shape Print Example from Martens

Besides use of direct-to-shape printing and augmented reality, there are other interesting aspects to this story. The ink set that KHS and Afga have created reportedly has cleared some key hurdles, working well in terms of abrasion resistance, light resistance, food safety, and de-inking. Meanwhile, beer in PET bottles, little known in most of the world, is growing in Europe. It is clearly helped there by environmentalism, since PET, which is lighter than glass, transports more easily; also, transport can be one way, since PET recycling is highly developed. Barrier technologies for PET like KHS Plasmax coating are also key to launching beer in PET containers, and have been in place at Martens Brouwerij for years. Such coating technology helps by reducing the permeability of PET, thus giving beer in PET bottles a longer shelf life, through better retention of carbonation and lower levels of oxidation.

On the inks, NMP Systems, which leases the Direct Print technology to Martens, notes that printed bottle images not only withstand the rigors of manufacturing but have also tested as enduring 80 weeks of supermarket lighting without degrading. After use, recycling of empty bottles printed by the system is certified by the European PET Bottle Platform (EPBP), the main industry association for Europe’s PET bottle industry, as fit for bottle-to-bottle recycling in markets where it does exceed 2% of the recycling stream.


"Direct Print Powered by KHS" Installation at Martens

Long in Development, More Coming

“Direct Print Powered by KHS” is the upshot of years of development work by KHS and its partners; the machine currently printing at Martens debuted at drinktec in 2013 under an earlier name, KHS Innoprint. NMP Systems notes that the next version of the Direct Print system, with more features and greater image flexibility, is slated to be installed and running at Martens in Q1 of 2016.

KHS and Martens are not alone in using digital printing to create a compelling labelling solution for the beverage industry. Europe, of course, was home to the world’s first really big “Share a Coke” campaign in 2013, using HP Indigo and flexo printing to label a billion bottles of Coke with the first names of millions of consumers. Germany, home of KHS, is also where Ball Packaging installed a CMYK inkjet engine from Tonejet (UK) in 2010 to print metal cans in CMYK. The Martens story, though, is a notable addition, for a few reasons:

•It puts direct to shape printing into a top brewer’s production facility
•It’s backed by a jumbo supplier of drinks automation and two key ones in digital print, Agfa and Xaar
•It pushes bottle printing to truly late stage customization, a strategic goal of many brands.
We believe the Martens story from Q3 2015 is an important one for digital printing in packaging, and that related ones from KHS and others will follow. With that in mind, direct-to-shape print systems are now included as part InfoTrends’ annual forecast report on digital printing of packaging.

[qvg] 03/9/2015 21:59

thanks Rivaldo,
KHS was mentioned on our visit to Xaar on 30th June as one of the main OEMs they are working with. i am surprised the article does not mention the terrific cost saving from direct to shape. we were told on our visit that the cost of standard labels is USD 4.50 / 000; and direct to shape is 23c / 000. quite some saving!!

[tongosti] 03/9/2015 16:13

Rivaldo - thanks for sharing. Good stuff indeed

[apad] 03/9/2015 16:03

Very well found red.
This sort of news is going to light Xaar's afterburners when the Tintins start to report it.
apad

[rivaldo] 03/9/2015 15:26

News not posted here - XAR with a "world's first"....



Extract:

"World’s First 'Direct Print Powered By KHS' System With Xaar 1002 Printheads In Production At Martens Brouwerij

Thursday, August 27, 2015

Innovative brewery now prints directly onto 12,000 PET beer bottles per hour to deliver ‘on-the-fly’ customisation at 1080 dpi resolution

Cambridge – The world’s first ‘Direct Print Powered by KHS™’ system using Xaar 1002 printheads is in industrial-scale production and printing directly onto PET beer bottles at Martens Brouwerij in Belgium.

The Direct Print system has been developed by KHS GmbH, one of the leading global manufacturers of filling and packaging systems; and commercialised by NMP Systems GmbH, a KHS subsidiary for innovation businesses. The Direct Print equipment at Martens uses Xaar 1002 GS6 printheads to jet high-resolution (360 dpi physical and 1080 dpi optical) text and images in five colours (CMYK+W) using low-migration LED-cured inks directly onto PET bottles at the production rate of 12,000 bottles per hour. Once again the Xaar 1002 demonstrates its market-leadership through TF Technology™ and the ability to print vertically.

“Direct printing onto empty PET bottles using Xaar 1002 greyscale printheads is breakthrough technology that enables beverage companies to change graphics within minutes instead of weeks,” says Phil Johnson, Managing Director of NMP. “The use of digital technologies for micro marketing in the packaging sector to maximise consumer engagement is accelerating. The ability to create designs and print them directly onto bottles quickly virtually ‘on-the-fly’, is a powerful marketing tool which will give brands the ability to localise, personalise and customise their products to drive highly-effective promotional campaigns. Brand owners are looking for deeper consumer engagement and digital printing will make it a reality. The Direct Print Powered by KHS™ performance system, including certified low-migration ink, artwork and pre-press solutions, sampling and industrial printing, will move PET bottle decoration into the filling and packaging world on an industrial scale.”......

......“Direct-to-shape printing is gaining traction as brands start to realise its considerable potential,” says Mark Alexander, Director of Business Development, Xaar. “We will see more and more creative applications come to market based on the Xaar 1002 with TF Technology™ which show how powerful digital printing onto PET, glass and cans can be when it is part of an industrial filling and packaging process.”"

[apad] 31/8/2015 21:21

In my view large companies cannot compete with innovative companies that have a genuine competitive edge by throwing money at a problem, so I am not at all worried about XAAR being overtaken. The followers can take the shine off an initiative but they have significant opportunities to create new markets and a track record of success.
I have some knowledge of engineers working for XAAR, and it is an impressive outfit.
Richard Beddard's opinions are worth a read.
No guarantees of course and tongosti might be correct, but I reckon 450/500 is a floor for the share price
apad

[qvg] 31/8/2015 18:44

Thanks Tongosti
and i do understand your view. i bought my stake during the second half of last year, and so my average entry price is a good percentage lower than today's price. But i don't think any of it was as low as 140m market cap - and being selfish i hope it never gets that low!

[tongosti] 31/8/2015 17:18

Qvg - thanks for your thoughts. I see where you come from but I have a slightly different opinion especially re valuation. XAAR is a cyclical business and as such i do refer to calculate growth over the last 10 years (trying o capture a full cycle) as opposed to latest 5 years (which have corresponded to a strong cyclical upswing I think). Hence the numbers I put forward to earlier. Naturally, the company could very well surprise us all and grow at 25-30% from here if they pull off what we hope they do - It is just that I tend to be a bit more conservative (but of course I could turn out to be wrong). I do believe that XAAR will turn out to be a great company in the next few years. It's just that a great company is a great investment only if you access it at a great price. As above explained, I don't think that's the case yet. Crazy as it sounds (in the sense that it may never happen), my "all in moment" would be anywhere below the 140mln market cap level. As you, I also tend to believe in a concentrated portfolio once you have formed a conviction. If my price target gets hit that's when I will load up on XAAR as well. Good luck.

[qvg] 31/8/2015 16:43

Tongosti
I do not find 15% growth for Xaar phenomenal at all. In the previous 5 years it has achieved 46% earnings cagr and 29% dividend cagr. It is entirely credible that the existing business will achieve 15% growth. The three main factors behind my confidence relate to the dominant existing ceramic business:
1. replacement cycle. the printheads need to be replaced about every 4 years. the big growth in 2013-2014 will be replaced 2017-18.
2. continuing switch to digital for ceramic printing. currently only 50-60% of ceramic printing is digital. the advantages of digital in this market are so overwhelming that this will become 100%.
3. ceramics market is expected to continue to grow, around 5% pa.

The company's figures for the impact of 2 & 3 are that digitally printed ceramic print area will grow from 6.5 bn sq m in 2014 to 11.9 bn sq m in 2022.

I find the above sufficient to justify the current valuation.

On top of this there are a wide range of other future growth areas, which in my view are being thrown into the valuation for nothing. As well as 3D printing, they include:
packaging (both labels and print to shape)
commercial printing
nanoimprint lithography - eg manufacture of silicon wafers.

Success in any one of these growth areas would turn Xaar from a good investment to a great one.

all IMHO. But as an indication of my confidence level, Xaar is my largest investment, around 10% of my portfolio.

[tongosti] 31/8/2015 14:09

What's to stop them throwing multiples of XAAR's R&D budget (the type of companies which can afford paying a huge premium over re likes of Domino Printing Sciences of this world?) to get a slice of the 3d business?What am trying to say is that, in my opinion, it makes sense to value XAAR on the current and immediate product ranges as opposed to indeterminate 3d products which may or may never come online and make a significant impact on the company's bottom line. Whatever XAAR gets into, a larger company can get into as well (and hence the difficulty of valuing future growth). In my estimation, current price level is fully discounting a 15% pa. growth (which is truly phenomenal by the way) in sales, profits and fcf for the next few years. As such, it only makes sense to increase your XAAR holding if you believe in a growth profile exceeding 15% a year. I don't share such an optimistic view and that's why my conservative approach. I love XAAR as a business and its splendid balance sheet - hence I hold a very small stake at the moment - but the current price is discounting a lot of future growth. Watching like a hawk in the hope of a better entry price level.

[qvg] 31/8/2015 13:19

using Xaar's technology or their own?

[tongosti] 31/8/2015 09:52

Their previous licensees in Asia for example

[qvg] 31/8/2015 08:20

tongosti
who would you say are their 2 or 3 biggest competitors in the 3d space?

[tongosti] 30/8/2015 10:42

Not that sure about that apad. 3d printing potential is just a bet at this stage. Xaar faces tremendous competition on the 3d front with competitors with much much deeper pockets.