Opportun ities for Improving th e Quality of Packaged Consumer Products wit h the Use of Le M ac’s Light Shiel d Sl

1. Opportunities for Improving theQuality of Packaged Consumer Products with the Use of Le Mac’sLight ShieldSleeve

2. BACKGROUND In the consumer packaged goodsindustry, product development and packaging professionals face the continual challenge of developing optimal combinations of product formulations and packagedesigns capable of delivering consistent value propositions to the intended consumer segment. Among the essential elements of any brand’s value proposition are the basic product features of colour, flavour or fragrance, and nutritional or functional value. Delivery on the promise of a brandrequires that the consumer perceive these elementsto be consistent, regardless of the place or time of consumption. Brand stewards recognise the value of ensuring that a product retains its desired benefitsnot only throughout its distribution and retail presentation but also during the expected post-purchase storageperiod and until the completion of consumption. Addressing the shelf-life issue is particularly challenging in today’s beverageindustry, where many players are pursuing growth throughthe development of new products that create andcater to new consumption occasions. The result is strong growth in several categories including juices, energy drinks, vitamin-enhanced functional beverages, teas, and dairy beverages. 2

3. LIGHT SENSITIVITYOF CRITICALPRODUCT INGREDIENTS Certain products packed in clearand translucent containers can be negatively affectedby visible and ultraviolet light radiation Visible Light • Light present in the visible spectrum, ROY-G-BIV. • Classified as light with wavelengthof 380 to 740 nm. • Does not cause direct damage to beverages. • Causes damage by affecting certain sensitizers present in beverages. Ultraviolet Light • Higher energy, shorter wavelengththan visible light. • Classified as light with wavelength of 10 to 380 nm. • Higher energy causes more damage than visible light. • UV light present in sunlight causessunburns. 3

4. LIGHT SENSITIVITYOF CRITICALPRODUCT INGREDIENTS Sources of Visible & UltravioletLight: • Artificial Lighting • Refrigerated cases • Store shelves • Sunlight • During transport anddistribution • Through shop windows • Incidental exposureafter purchase 4

5. INGREDIENTS DAMAGEDBY VISIBLE & UVLIGHT Many ingredients are independentlyunstable in the presence of UV. Others, however,show stability to UV in isolation but become unstablewhen formulated with other ingredients. 5

6. (1) UV Sensitivity of Colourant Ingredients Colour is a prominent and defining attribute of most consumer products. Consumers can readily observeslight inconsistencies in product colour and may perceive themas indications of poor quality. In the US, 7 synthetic dyes are approvedfor general food use and more than 30 are approved for generaluse in cosmetics. Although many of these dyes independentlyexhibit favourable stability to UV light, they have been shown to be unstable to light when formulated with certain ingredients. For example, ascorbic acid (vitamin C)is frequently added to beverages to scavenge dissolved oxygenthat can attack certain flavour components. However, the presence of ascorbic acid in beverages containing certain syntheticcolorants can result in rapid fading upon exposure to UV light. The presence of trace metals can alsohave a destabilizing effect on the synthetic colorants. The various natural colorants approvedfor general food use vary widely in their stability to light. Turmeric,beet, elderberry, annatto, and paprika extracts are most sensitiveto light-induced degradation. 6

7. (2) UV Sensitivity of Flavour and Fragrance Ingredients Consumers are demanding greater variety and fusion of flavour elements in food and beverages. Similarly, in personal care and householdcleaning products, fragrance ingredients can lead to a diminished sensory profile and also to the formation of unpleasant off-notes detectable by taste and smell at low concentrations. Themost common example of this is the lemon aroma complex whichis widely used across a range of products in beverages, food,and other consumer products. One of the significant contributors tolemon flavour, and also one of the most photosensitive, is “citral”.Upon exposure to UV light, citral degrades into several by productsincluding “photocitral-A” and “photocitral-B”. Citrus beveragesare often packaged in green bottles to protect against this but as tests conducted by Milliken Chemical show the formation of photocitral-A occurs rapidly in both clear and green PET bottles withthe accompanying onset of detectable off-flavour. Milliken concluded protection againstwavelengths up to at least 390 nm is required to retain theintegrity of the citrus flavour package and this cannot be achieved with either green or standard clear PET bottles. 7

8. (3) UV Sensitivity of Vitamins and Nutrient Ingredients In recent years consumer demandhas been driving the supplementary inclusion of manyvitamins and nutrients in beverage, food, and personal careproducts as a means of delivering new and differentiatedsets of benefits to targeted consumer segments. Vitamins and nutrients are generallysensitive to the effects of temperature, oxygen, and light.Slight change in the molecular structure of a nutrient can render it biologically ineffective. The following vitaminsare known to be specifically vulnerable to degradationby UV light: Vitamin A, B2 (riboflavin), B6, B12, and folic acid. Light also accelerates the destructiveinteraction between vitamins. As an example, the degradationof both folic acid and vitamin C is accelerated by the combined presence of riboflavin and light. This effect, for example, is the cause of Vitamin C degradation in milk exposed to light. 8

9. (4) Specific Effects of Light On Milk • When milk is exposed to light,the following are consequences: • Loss of vitamins • If flavoured, changes to flavourprofiles • Protein oxidation (with resultant burnt flavour or burnt • feathers flavour) • Lipid oxidation (with cardboard/ metallic off flavour) • Riboflavin (Vit B2) • Riboflavin is photosensitiser for protein and lipid oxidation • When milk is exposed to lightin the presence of Riboflavin, • off flavours develop. • If milk is not exposed to light,no off flavours develop • If Riboflavin is removed and the milk is exposed to light, no • off flavours develop. Absorption Spectrum of Riboflavin Where Riboflavin absorbs light and causes problems. Options for protecting milk in non opaque containers. An opaque barrier, effective across the UV and Visible spectra up to 530 nm is necessary (this blocks all radiation which affects riboflavin). To protect Vitamin C content, a barrier across the UV and visible spectrum is required. 9

10. THE LE MAC / FUJI SEAL SOLUTION Fuji Seal has developed the Light Shield Sleeve to reduce the negative effects of light radiation on packaged consumer products. • The Light Shield material from Fuji Seal is an opaque PET which: • Can achieve top to toe bottle shieldingon shapes requiring up to 60% sleeve shrinkage. • Being PET is recycle friendly. • Being opaque hides settlementlevels and scum marks. • Being opaque is unaffected by the colour of the bottle contents. • Is a brilliant white for a vivid, visual impact and accentuates the printed design resulting in improved legibility especially for senior citizens. • Has zero MD shrink resulting ina low shrink force during the shrinking process which produces: • No smiley faces • A uniform shrink finish • Makes the shrink process easy to control. 10

11. The Performance of Light Shield CanBe Measured by theLight Shield Factor (LSF). This definesthe wavelength at which 5% or less radiation is transmittedthrough the sleeve. The Light Shield Factor (LSF) can be varied through the printing process: Eg. LSF 380 – Light Shield Sleeveproviding <5% transmission @ 380nm LSF 500 – Light Shield Sleeve+ printing providing <5% transmission@ 500nm LSF 800 - Light Shield Sleeve+ printing providing <5% transmission@ 800nm Light Transmission Curve Visible ray IR UV 11

12. From the Light Transmission graphabove, the exceptional performance of Light Shield can be clearly seen: • Conventional transparent shrinksleeves transmit almost 20% of light radiation for wavelengthsat 280nm and 90% at 420nm or above. It has an approximate LSF of 270nmie <5% of light is transmitted @ 270nm. • If this conventional film is reverseprinted with 2 layers of opaque white ink and one of silverthe LSF rises to approximately 380nm ie <5% of light is transmitted @ 380nm. 30% is transmitted at 420mm increasing to almost 50% @ 800nm. • By contrast, Light Shield which also has a LSF of 380nm (<5% being transmitted up to 380nm) transmits only 25% of light @ 800nm. • If Light Shield is printed on the reverseside, the transmission percentage decreasesdepending on the colours chosen. In the case ofblack ink, the LSF is 800nm, ie less than 5% is transmitted@ 800nm. 12

13. THE EXPERIENCE IN JAPAN Since Light Shield was launched in Japan in 2004, the annual usage of Light Shield film hasalmost doubled to 150 tonnes. Applications in the Japanese marketinclude dairy beverages, vitamin enriched functional beverages, fruit juices, iced tea, Japanese sake, condiments and cosmetics. Some examples are as follows: 13

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23. THE EXPERIENCE IN NORTH AMERICA In 2007 Light Shield was adopted by Nestle, USA on its range of 300ml UHT flavoured milks filled in Mexico. This is the first use of Light Shieldoutside Japan. 23

24. Nestle’s requirement was many fold: • 1. A maximum light transmission of 1% @ 800nm. • Extended shelf life to attain greater geographical • reach for product distribution. • 3. Reduced transportation cost. • 4. Reduced overall packaging cost. • 5. Meet Walmart’s directive for reduced in store • packaging waste. The American Fuji Seal Solution 24

25. All these objectives were met: • An LSF of 800 nm with less than 1% light transmission was achieved with the use of a print enhancedLight Shieldfrom American Fuji Seal. 2. This resulted in an extended product life (Data confidential to Nestle). 3. Nestle changed to a UHT product which could be distributed using non-refrigerated trucks resulting in reduced transportation costs. 4. Because of the extremely high LSF achieved with Light Shield, Nestle was able to change the secondary packaging for distribution from a full wrap-around carton to a half tray carton thereby significantly reducing secondary packaging costs. 5. The move to a half tray carton resulted in significant reduction of in-store waste at Walmart. 25

26. VALUE IMPLICATIONS OF Light Shield SLEEVES FOR BRAND OWNERS Specifying Light Shield sleeved bottles for qualified applications represents an opportunity for brand owners to realise value in several ways: • Light shield can contribute substantially to extending the shelf life of UV and visible light sensitive formulations, thereby increasing the likelihood of a consistent consumer experience, which in turn drives brand loyalty. • From a financial and risk perspective, Light Shield provides an element of protection for the extensive sums invested in product development, promotion, and brand development. The cost of utilising Light Shield translates into a small percentage of the retail price of the product. • Light Shield can give the product developer increased flexibility by relaxing constraints on the need to accomplish a UV-stable product through formulation alone. 26

27. VALUE IMPLICATIONS OF Light ShieldSLEEVES FOR BRAND OWNERS • Light Shield can contribute to new product innovation allowing formulators to choose from among UV-sensitive ingredients that previously were avoided. • Using Light Shield may alleviate the need to use stabilising compounds as direct additives to the formulation. • Light Shield reduces the need to “overshoot” loadings of UV-sensitive ingredient • Light Shield gives packaging designers increased flexibility in packaging aesthetics by utilising all the traditional benefits of shrink sleeve decoration. 27

28. CONTACT DETAILS The Le Mac Australia Group Cnr Railway Road North & Hudson Place MULGRAVE NSW 2756 Tel: 02 4577 4799 Fax: 02 4577 4379 Email: salesenquiry@lemacaustralia.com.au Web: www.lemacaustralia.com.au 28