Fresh cell treatment for gravure printing provider TSB

In 2023, the French Riccobono Group acquired the German company TSB, making it Europe’s largest gravure printing provider. In the following interview Dr Udo Bogner and Michael Distler explain what this means for TSB and gravure printing.

In mid-2023, the Bagel family sold the TSB Group to Riccobono. How did this come about?

Dr Udo Bogner: As a gravure printing company, unlike web offset, we have been intensively involved in the consolidation phase since 2006 and today we see a largely consolidated market in the gravure printing segment, which has also led to a serious reduction in capacity in the TSB Group in line with market developments. Over the past few years, we have closed our sites in Alba (Italy) and Munich and we will also be divesting our web offset activities in 2024. This means that we are now looking at a very reduced company that is back to its 1998 level in terms of machine capacity. For our shareholders and us as managing directors, the question arose: Can we survive on our own in the long term with this company size, or can we only do so as part of a joint venture or a strategic partnership?

With these considerations in mind, we started talks with Mr Riccobono in 2022. Guillaume Riccobono sees this merger as a real entrepreneurial opportunity to actively shape the consolidation of the printing market and he also has the courage to do so abroad. However, a prerequisite for Riccobono’s involvement was that we set up TSB in a lean way, have stable capacity utilisation and at the same time generate capacity utilisation in France. The transition from Bagel to Riccobono then took place in July 2023.

Michael Distler: We had been planning a possible reduction from six to four machines as an option on the management side for some time in the event of further volume reductions. This step would have been necessary even without the merger with Riccobono.

Which companies are still active in the European publication gravure printing market?

Dr Udo Bogner: Following the closure of Prinovis Ahrensburg, Riccobono, Bauer, Burda, Rose and Roto Sud remain in gravure printing. Walstead and Pozzoni are also leaving gravure printing. The field of market competitors has become very manageable and with the departure of major market competitors and the merger with Riccobono, it is possible to become the market leader. For TSB, the move into the Riccobono Group was a positive sign of a new beginning. We feel good and we enjoy it because we can now develop new things again. Incidentally, this was also one of the main items on the Bagel family’s agenda. For them it was an urgent matter to create a connection that would make TSB fit for the future. The Bagel family continues to be linked to TSB within the Riccobono Group. Guillaume Riccobono got involved in the negotiations with Verdi and our workforce at an early stage and sat at the table. He wanted to know who he was joining forces with.

Michael Distler: It was important for Guillaume Riccobono to get a feel for the employees, the management and the spirit of TSB. Does he encounter an open mentality here, employees who are prepared to take this step into a French group? Or is there resentment? It was this triad of employees, management and shareholders that had to fit together and in the end it all worked out.

What has changed for TSB under the Riccobono umbrella?

Dr Udo Bogner: We are getting a lot of new impetus from the coming together of the different customer needs and the different companies in the Group and, of course, from the will of everyone involved to achieve something new. All of this makes a big difference to the past and creates a change of mood that can also be felt in the workforce. There is a spirit of optimism. I am convinced that gravure printing will experience a kind of renaissance.

Michael Distler: The changed, better situation we are now in is also due to a more stable utilisation of our remaining four machines. It is now easier for us to enable over-utilisation in terms of sales and to distribute this order buffer within the Riccobono Group.

How does this collaboration will look like?

Dr Udo Bogner: The Riccobono Group is organised in different pools. For example, there are the finishing and daily newspaper pools, and then there is the gravure printing segment. Here we coordinate investments and purchasing. At the monthly management meetings, which take place at different locations of the Riccobono Group, the necessary key figures are now also being developed in order to establish comparability. We talk about the issues very openly. Where there is friction, solutions are always sought and found in the interests of the Group.

Michael Distler: The Riccobono Group has its origins in Montpellier in France and there is actually no group headquarters. The management is spread across the locations and is still in close contact with each other. There are a few companies where they meet more frequently for logistical reasons, for example the printing centre of “Le Figaro” close to Charles-de-Gaulle airport in Paris. But there are also regular meetings here in Mönchengladbach or at Lenglet in Northern France.

Dr Udo Bogner: As TSB and currently Riccobono’s only non-French company, we currently have a little more autonomy in the Group. We are now a bridgehead in Germany, the largest single market in Europe, and Riccobono’s involvement with us is certainly not the end of its activities in Germany. However, there is still no master plan as to which activities will be pursued in the future.

What will your machine park in Mönchengladbach look like after the closures?

Michael Distler: In future, we will operate machines in three different format classes: a KBA TR 6B with a web width of 2700 millimetres, two KBA TR 9B with 3520 millimetres and a TR 10B with 3680 millimetres. The 2700 millimetre machine is what we at TSB call hybrid technology. With a former and horizontal folder, we can produce handbills in the same way as high-volume web offset, i.e. also A3 productions. We have retrofitted this machine with an 11th ribbon so that we can also produce very small formats. It is therefore an absolute accent machine and for special productions from large to small formats and strongly tailored to the retail trade, while the large presses – at 3520 and 3680 millimetres – cover mail order and newspaper jobs. We are able to lay out both in stacks and packages from all machines, i.e. finished products directly onto pallets.

Dr Udo Bogner: The whole thing is paired with efficient further processing. We will continue to maintain this in the future – including our Sitma machines. Another positive aspect is the proximity to Lenglet, which is only 300 kilometres away. There, for example, we have perfect binders and four identical KBA TR 10B rotogravure presses in an ideal configuration. Of course there are differences: we have 16 lines, Lenglet has 14 and we can also process 800-count cylinders. But basically it is a very harmonised production, which allows us to complete orders at both locations. The French market fills around 30 per cent of TSB’s capacity.

In this context, doesn’t hybrid mean offset plus gravure printing?

Dr Udo Bogner: We will no longer be active in offset in the future – on 31 March 2024, we will end our activities at the Bagel Roto Off¬set site in Meineweh, Thuringia. The company will be completely closed and the machines will be sold. Operations will not be resumed at this site at a later date. Together with the representatives of the workforce and Verdi, a social plan and reconciliation of interests was negotiated, which was accepted with a high level of approval. We are convinced that we have achieved a very satisfactory result for the workforce and for our company.

Does web offset still exist at all within the Riccobono Group?

Dr Udo Bogner: Web offset is still present, but Riccobono sees the main synergy effects in gravure printing activities.

Michael Distler: In the European gravure printing market, we have now reached a ratio in which customer demand roughly reflects the available capacities. In the web offset market, the relationship between capacity supply and reduced customer demand is currently unbalanced.

Dr Udo Bogner: These are essentially the reasons why we have decided to disinvest in web offset and why Riccobono has decided not to enter the German offset market.

There is also the family-run Bertelsmann Group, which has shut down one printing plant after another. What distinguishes Riccobono’s corporate policy from that of Bertelsmann?

Michael Distler: Of course, you can’t compare the Riccobono Group with the Bertelsmann Group, with its broadly diversified activities. Riccobono concentrates on business areas that are very close to its core business of printing – in order to then develop the appropriate offerings in this segment. This is simply a different approach with a clear commitment to printing and in particular gravure and newspaper printing.

Dr Udo Bogner: The Riccobono Group has undergone an exciting development – starting with just a few newspaper publishers and subsequently consolidating the national newspaper market in France. Riccobono is now responsible for the entire press and print logistics in the Paris region and is also investing in this area in Belgium, for example. With his activities in the newspaper sector, Mr Riccobono has thus gained access to web offset companies and ultimately also to gravure printers. The Riccobono Group can now offer many service packages exclusively and with the Mönchengladbach site, it has now gained access to the largest print market in Europe, Germany.

In other European countries, such as the Italian printing market, we are also seeing how entrepreneurial families are seeking different paths. After Mondadori, the Pozzoni family also closed its gravure printing plant near Milan at the end of 2023. With the exception of Roto Sud, gravure printing in Italy is now history! On the other hand, you will find the Bandecchi family, which continues to play an important role in the Italian web offset printing market with Rotolito.

So you are definitely one of the companies to believe, that print still has a future?

Dr Udo Bogner: Of course print also has a future. The only question is: does high-volume commercial printing have a future? I’ m not worried about the demand for print in our segment for the next five years; we have a good feeling even until 2030. At best, we can still express hopes until 2035, after that we are in the dark. We are therefore talking about a time horizon of a good ten years, which we can see positively, but only if the political environment remains stable. What makes the integration of TSB into the Riccobono Group so imaginative is the great expertise of all those involved. International dialogue is also much easier than one might imagine. Collaboration with our French colleagues is very pleasant and collegial. You can think of anything. Every idea is welcome. We have ten years of consolidation and struggle behind us in gravure printing in Germany and suddenly, with TSB, we find ourselves in an environment where people see opportunities above all else. It’s like a fresh cell cure.

What’s next for your market?

Dr Udo Bogner: We firmly believe that demand will remain stable over the next few years, for example in the mail order business. There is a minimum demand for gravure printing. The flyer remains highly relevant as a stable push medium. This is why high-volume web offset will continue to exist, but the constant growth of the last decade is over. The big advantage for gravure printing is format variability, which enables us to save paper and therefore costs. Of course, we are not a digital printing company and we won’t be one tomorrow. But we can now offer many solutions around our core business that we would not have been able to offer today as a pure TSB without Riccobono. This opens up completely new approaches to talking to our customers.

What else would be conceivable to advance the gravure printing process and make it more environmentally friendly?

Michael Distler: We are constantly endeavouring to make the company more environmentally friendly. Due to our environmental management system, which is practised throughout the company, we have been EMAS-certified for years and are currently looking intensively at the possibilities of switching from Chromium VI to Chromium III in cylinder production, for example.

What about water-based printing inks?

Michael Distler: This is also an issue that we are monitoring closely, but we have not yet launched any projects in this area. One of our most important environmental projects in 2024 is the generation of industrial steam, which we need for our production. To date, we have used pulverised lignite for this, but in future this will be done using gas firing. We have also looked into plans for a biogas plant, but this would take us into investment regions and time cycles that probably go far beyond today’s foreseeable business perspective. The move from lignite to gas-fuelled steam generation will significantly reduce our CO₂ emissions, but will of course not take us to zero.

Dr Udo Bogner: With every technology that we consider, the question always plays a role: What are the maintenance costs? How much effort is required to generate a certain output? We know from direct comparison that gravure printing is by no means at a disadvantage here.

The gravure printing press manufacturers have been out of the market for a while now. How do you solve this issue and how big is your workshop?

Michael Distler: The supply of spare parts for certain items is actually becoming an ever bigger challenge for our workshop. Gravure printing machines themselves are extremely robust and durable. But of course there are wearing parts and therefore the need for spare parts, for example in the case of electronic units that are no longer supplied today. Or mechanical spare parts, which you can only have individually manufactured at great expense today. Our employees in the workshop department are highly qualified and can cover most tasks very well. In addition, we also use external service providers known in the industry for special issues or major repairs and conversions. As far as the supply of spare parts is concerned, unless they are really special parts that have to be produced individually, we now utilise the third-party market. We are in contact with all known used machine dealers in this regard and I think every workshop manager has also tried to obtain spare parts on eBay.

Dr Udo Bogner: Another challenge for the gravure printing industry is that shrinking volumes will increasingly become a problem for gravure ink manufacturers when the market reaches a critical size. We are therefore working within our group with both ink manufacturers that still offer gravure inks, Siegwerk and Sun Chemical.

There are additional challenges that are common to all high-volume printers …

Dr Udo Bogner: Yes, because as printers we have to defend our product very strongly in the market at the moment. We have to defend ourselves with arguments against attacks that misrepresent the environmental friendliness of printed matter compared to digital offerings and thus harm us. However, the most serious issue for the manufacturers of addressed and unaddressed printed products in the coming years will be delivery: how can we ensure that newspapers and brochures will continue to be distributed throughout Germany at an adequate price and in an adequate time? The associations and companies are currently working on suitable solutions. It is not yet clear what these will ultimately look like, but we are certain that solutions will be found.