It is with much pride that I announce the appointment of Keith Watkins as chief operating officer of the Group with immediate effect.

This is a newly created but extremely important position within Astrapak. His role will be to take overall charge of operational matters relating to the Films, Rigids and Industrial Divisions. Together with the senior management team, Keith will be looking after the day-to-day nuts and bolts of the operation.

Keith brings a wealth of experience to the position and spent many 15 years at the coalface as managing director of Thermopac. He's a man who understands the business from the ground up - he pioneered the introduction of World Class Manufacturing seven years ago - and I'm confident he will contribute immensely to every operation in the months and years ahead.

I'm sure you all join me in wishing him the very best success in his new role.

Halfway through last year our results were pretty dismal. So much so, in fact, that we had to notify the market that our year-end was likely to be substantially worse off than previously forecast.

However, thanks to the herculean efforts of everyone in the Group, results posted at the end of February '09 showed a dramatic turnaround and we were able to record significant improvement in several important areas.

While turnover increased by 16% to R2.75 billion, price increases and not volume accounted for the biggest share. EBITDA was up a respectable 15%, but the real improvement has come about in working capital. Better financial discipline has increased cash from operations a huge 207% and enabled us to reduce debt. When you realise our average interest rate was 1.7% higher in financial '09 than the year before, anything to reduce debt is of paramount importance.

We are not out of the woods yet. We need to stick to our newly established financial procedures and benchmarks and continue to drive costs down at every opportunity. But well done on the good work so far.

According to most economic contributors the worst of the global financial crisis may be over but local newspapers continue to predict tough conditions for South Africans for some time to come. And as suppliers to the consumer-goods market - where disposable income is down - that is a note of concern for us. There is clear evidence that spending on non-durable consumer goods has declined significantly. While consumers are spending less and 'trading down' in their purchases, we - in most cases - supply the packaging for products in those categories also, hence we are still receiving good orders in most operations at the moment.

Fortunately the country's underlying financial structure was more resilient to downturns than many overseas markets - thanks to the prudent nature of our monetary policy and the National Credit Act. We should not underestimate the positive impact of the huge infrastructure programmes undertaken by Government. These activities have added significantly to job creation and that means consumers with cash in their pockets. But, in spite of several cuts this year, we still face relatively high interest rates which do have a material impact on our business.

The introduction of Syspro and World Class Manufacturing has come not a moment too soon. We are doing everything to benchmark our operations against the best in the world and we must pursue this quest for continual improvement. Organisations much bigger and with greater pedigrees than ours have come crashing down in the past 18 months. It's up to us to determine our own future and ensure we are well positioned when the good times return.

Research from the US clearly indicates that plastic's role in food packaging is only likely to grow and, in most cases, this will come at the expense of traditional substrates like glass and tin.

The price indices for the latter two products presented by Charles Muller at the recent sales conferences support the ever-growing cost advantage of plastic. Yes, in some instances the perceived 'high-quality' image of glass may hold sway in certain situations but the growing popularity of the Astrapouch in the wine market shows that no sector is immune to innovation.

As SA's leading supplier of plastic solutions we must be exploiting these pricing differentials to identify opportunities where we can supplant old tired packaging with new, exciting and innovative plastic versions. Offering our clients not only more cost-effective answers, but ones that increase their shelf presence in a highly cluttered retail environment.