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 user 2008-05-07 at 2:26:39 pm Views: 53
  • #19750

     Ian Dinwoodie, CEO of inkjet pioneer, Xaar
    2008 Image”Xaar is in an excellent position of having a good cash
    balance, no debt, great technology, good management, and a good
    business plan. Hence operationally and financially we are highly self
    sufficient, and don’t see the need for a parent. However ‘money talks’
    and there is no doubt a price at which our shareholders would say
    ‘thank you very much’.”

    Headquartered in
    Cambridge with manufacturing plants in Huntingdon and Sweden and sales
    offices spread across the world’s continents, Xaar plc is a leader in
    the supply of high-technology inkjet components and the provision of
    fully integrated systems.Spun out of Cambridge Consultants, it is an
    integral part of the world leading Cambridge inkjet cluster and has
    filed over 700 patents since 1986, commercialisation of which have
    resulted in the provision of a range of inkjet printheads and inks
    which benefit from continual development.Ian Dinwoodie joined Xaar as
    Group operations director in September 2001 and was appointed chief
    executive officer in July 2003. With over 20 years experience in
    hi-tech operations, he has held a variety of roles in engineering,
    quality assurance and manufacturing within the semiconductor,
    electronics and electronic imaging industries including director of
    manufacturing for Fujifilm Electronic Imaging Ltd.

    1) What attracted you to Xaar originally and what has kept you there since?
    had spent many years in the semiconductor and electronics industries in
    my early career, then shifted into print and imaging in the mid 1990s.
    The opportunity at Xaar appeared to be a unique opening where I could
    use all of my previous experience to maximum effect.Additionally after
    spending many years in large corporations, I was looking for a smaller
    and much more dynamic environment, where individuals can have a clear
    impact on the performance of the company. What has kept me here is that
    we are building a business, and we have a long way to go, every day is
    different, and we have fun.

    2) You’ve been CEO for almost five
    years, what have been your biggest challenges and accomplishments?In
    the early days the challenge was to rapidly change the financial
    performance of the business. In the first half of 2003, the company was
    losing significant amounts of money, we took some fairly radical
    action, and I’m pleased to say that the company returned to
    profitability in the second half of 2003, and has generated sector
    leading margins from that point to the present day. Following that
    turnaround we have build a fairly unique, growing and highly successful

    3) What would you like to see happen at Xaar over the next five years?
    have made significant investments in new technology and new product
    developments over the past few years, and I would like to see – and
    expect to see – the business grow significantly based on the adoptions
    of this new technology both in our existing markets and our new
    targeted ones.

    4) Xaar rejected an approach from local inkjet
    cluster hoover, Danaher, because it undervalued the firm; how much
    pressure is there for Xaar to accept such offer.As a public company, we
    must always consider what is best for our shareholders, as well as our
    employees. Xaar is in an excellent position of having a good cash
    balance, no debt, great technology, good management, and a good
    business plan. Hence operationally and financially we are highly self
    sufficient, and don’t see the need for a parent. However ‘money talks’
    and there is no doubt a price at which our shareholders would say
    ‘thank you very much’.

    5) What kind of effect has the American
    invasion (Linx, Willet, Videojet, Elmjet) of Cambridge inkjet had on
    the cluster?For Xaar the only impact so far is that some of our sales
    have moved from the UK to the US. Industrial inkjet whilst still in
    it’s infancy is growing and developing rapidly across the world. For a
    small company we are a very international business with more than 95
    per cent of our sales being made outside the UK.

    6) As one of
    the global leaders in the field working from the sector’s foremost
    cluster, how far in terms of revenues and offering can Xaar go on its
    own?As I stated earlier we are financially and operationally
    independent. We can fund our own growth, and have aggressive plans for
    the future. As a public company I am not allowed to give forecasts,
    however I would say that we intend to be significantly larger than we
    are today, and see our independence as an asset not a constraint.

    You are involved in a number of collaborations with really exciting
    cutting edge technologies – printed electronics, fuel cells, medical
    device skin grafts – how important is this to Xaar and which one of
    these is closest to producing a market-ready productThey are
    interesting opportunities and potential upside for the future; however
    our core growth plan is based on converting the industrial and
    commercial world of print across to Xaar technology.Of the non-print
    related markets Flat Panel Display manufacturing is the application
    closest to commercialisation. It is too early to say which will
    commercially generate the greatest return.

    8) Is there some element of risk by becoming involved in so many projects?
    so we have specifically limited the amount of work we do in this space.
    Our core developments are all based on the requirements of the print
    market, and if these developments can service alternate applications
    without distraction then we are happy to service them. We will not
    start any development without clear financial returns.

    Manufacturing moved out of Cambridge around nine years ago, but now
    it’s back (in Huntingdon, £10m, 30 new jobs). What changed and how long
    can it remain a sustainable practice here?I joined the company as ops
    director in 2001, and my first decision was to move manufacturing. At
    that time our large manufacturing plant in Sweden was under-utilised,
    and the small UK manufacturing capacity was really still part of R
    & D in Cambridge. It was an obvious decision to rationalise. The
    Swedish facility is now approaching full capacity, and we knew that the
    platform 3 product (XAAR 1001) would be so important to our future that
    we didn’t want to start in one operation then have to move it later,
    hence the decision to open a second plant.The manufacturing process is
    highly capital intensive, hence the cost of depreciation is dominant,
    and would be the same anywhere in the world. Also the cost of yield can
    be significant (if you get it wrong) hence having a brand new
    technology start close (but not too close) to your R & D centre
    makes great sense. As we continue to grow we will continuously review
    our cost base; however I see the Huntingdon facility as being very
    sustainable over the long term.

    10) You’ve expanded in North
    and South America; what steps are you taking to penetrate other new
    markets and how are these going?Geographically we are strongest in Asia
    which generates over 50 per cent of our sales. China is our largest
    market, but India is now also growing fast. Europe generates 30 per
    cent of our sales, with the Americas topping up the rest.As I said
    earlier, we are very international for a small company, and our key
    drive now is to enter other areas of the print market generating
    additional growth through diversification of the end applications.
    These new markets include label print, packaging print, ceramics print,
    then eventually all areas of commercial print including direct mail,
    and colour publications.