AAK Annual Report 2019

29 29 Tefac – industrial applications AAK’s business for technical applications, Tefac, had an excellent 2019 in a historical perspective, but did not quite reach the level of the record-high 2018. Our high-end products are still in demand, and we saw particularly good growth for our vegetable candle waxes. This was, however, offset by very low prices for glycerine caused by a substantial global oversupply and a volatile raw material market. Solutions AAK offers fatty acids and glycerine that are produced by splitting the fat molecule and refining the outcome into value-adding solutions for various applications. Based on sustainably produced vegetable oils, AAK also offers solutions for candle makers. Trends In 2019, there was good growth for our candle business. Consumer preferences for more sustainable solutions are driving our customers in the candle industry away from fossil paraffin. Our customers with exposure to the plastics and automotive industries in Europe experi- enced a sluggish market during the second half of 2019. New products We have during the year continued to add solutions to our portfolio for candle makers to match our customers’ demand for sustainable and functional candle waxes. Future growth AAK has historically provided a wide range of products for candle applications. With our widened product portfolio for candle wax applications, we will continue to focus on developing more opportunities in this segment to build the best possible pipeline for future growth. 2015 2016 2017 2018 2019 Volumes, thousand tons 263 274 278 301 300 Net sales, SEK million 1,243 1,233 1,417 1,513 1,456 Operating profit, SEK million 88 100 84 155 150 Operating profit per kilo, SEK 0.33 0.36 0.30 0.51 0.50 Volumes (13% of Group total) (Thousand tons) 2015 2016 2017 2018 2019 350 300 250 200 150 100 50 0 300 301 278 274 263 Operating profit (7% of Group total) (SEK million) 2015 2016 2017 2018 2019 160 120 80 40 0 150 155 84 100 88 Operating profit per kilo (SEK) 2015 2016 2017 2018 2019 0.60 0.50 0.40 0.30 0.20 0.10 0.00 0.50 0.51 0.30 0.36 0.33 Technical Products & Feed