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Elmo Leather taking leading position in environmental improvements:


Reduces nitrogen emissions by 80%
EU funding for new treatment plant
Elmo leather will become the first leather manufacturer to reduce nitrogen emissions by 80% when the company invests around SEK 40 million in a new treatment plant at Svenljunga. The project, based on new technology for the biological treatment of the company's wastewater, has been recognised by the EU's environmental fund, LIFE, via a grant of SEK 9 million.

The innovative project takes wastewater from the companyís processes and filters it through a nitrification/de-nitrification process. The technology has been tested by the municipal sewage treatment works but never put into operation in the tanning industry because it wasn't con-sidered technically possible because of the wastewater's character.

Nitrogen emissions are expected to fall by 80% compared to the normal 30% using traditional treatment methods for tanneries' wastewater.

New purification technology
The current method for reducing nitrogen pollution in wastewater from the tannery industry consists of a combination of chemical and biological treatment. The new technology that Elmo intends introducing, uses a process called nitrification/de-nitrification, and is an advanced form of a completely biological treatment.

In summary this technology means that water pollutants are broken down using the micro-organisms that exist in the wastewater. This occurs in a series of processes where wastewater is treated step-by-step in separated, but linked, tank systems. The first link in this system consists of an oxygen infusion tank where micro-organisms live and grow. During the second link the wastewater is oxygenated, which starts the nitrification process where nitrogen (NH4-N) mainly in the form of Ammonia, is oxidized into nitrate (NO3-N). The supply of oxygen is cut during the following de-nitrification process and nitrate is reduced into nitrogen gas (N2). The nitrogen gas is emitted into the atmosphere, which consists of 79% nitrogen gas.

In simple terms this new purification technology means that the micro-organisms in the waste-water are first allowed to grow and multiply. To survive they are forced to use up nitrogen pollutants due to the lack of oxygen. The result is that the dominating part (around 80 %) of the pollutants disappear because they have been reduced to nitrogen gas, i.e. the same gas that dominates the atmosphere.

Investing for a better environment
Provided that all permits are granted, Elmo Leather estimates it can start building the new treatment plant in October 2003. The investment will depend on the county administrative board authorising the expansion of the production limit at Svenljunga from the current 3.5 million sq m to 4.5 million sq m of finished leather.

The new wastewater treatment project is underway and the plant is expected to be up and running from autumn 2004, thereby considerably reducing the companyís environmental impact. Until the new plant reaches full capacity, the company's wastewater will be treated at the municipal sewage treatment works using the current method.
In the long-term, Elmo Leather expects investing in a treatment plant to benefit the company by spotlighting its environmental profile.

"In the short-term our profitability will not benefit, but over the longer term we believe that the project will strengthen our competitive edge and position on the market by emphasizing Elmo as a more environmentally aware company," says Nalle Johansson, President and CEO of Elmo Leather AB.

EU grant for innovative technology
The EUís environmental fund LIFE makes environmental protection and nature conservation grants within the European Union. The main purpose of LIFE is to drive the implementation and development of the EUís environmental policy by supporting pilot projects that illustrate innovative technologies or methods. A LIFE project should serve as a good example and turn environmental policies into practical action. LIFE projects in Sweden are administrated by the National Environmental Protection Agency.

Elmo Leather has applied for, and been granted, funding of EUR 1 million (around SEK 9 million) from LIFE for building its new treatment plant.

The company has produced a preliminary technical design of the new plant based on laboratory tests. The design will now be planned in detail and the plant will be built following a detailed test programme where special attention is paid to the sensitive nitrification/de-nitrification processes.

The company has also guaranteed that for 18 months, to May 2006, it will measure the effectiveness of the plant and distribute information about the result to other tanneries and other relevant industries, e.g. the textile and paper industries, water purification plants and the authorities.
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Elmo Leather expects at least 75 % of the European tannery industry to have been informed about the new technologyís environmental and financial benefits by the time the project is completed.

The Commission granted 104 of 530 applications, i.e. 20 %, illustrating the stiff competition.

Svenljunga, Sweden on the 9th September 2003
Elmo Leather AB
Questions can be answered by Nalle Johansson on: +46 (0)325 661400 or +46 (0)705 817738.
To the editor:
Elmo Leather is the world's largest manufacturer of exclusive furniture leather and one of the six largest suppliers of leather to the international automotive industry.

The company operates in some 40 markets worldwide and about 90% of sales are generated in markets outside Sweden. Of the Groupís total sales of around SEK 816 million in 2002, furniture leather accounted for 50% and automotive leather for 50%.

Elmo Leather is a strong international brand for some of the worldís finest leather. The Group works in a small niche of the international leather market, where high prices are accompanied by high requirements for quality, design and comfort. The company's management system fulfils the requirements of ISO/TS 16949 and ISO 14001.
The Elmo Leather Group consists of the parent company, Elmo Leather AB, in Svenljunga, Sweden, and the two wholly-owned subsidiaries Elmo Leather Inc. in Edison, New Jersey, USA and Elmo Leather A/S on Fyn, Denmark.
Manufacturing is concentrated in Scandinavia, at facilities in Svenljunga, Sweden and Svendborg, Denmark. In autumn 2003, Elmo Leather will open a new production plant at Wismar on the Southern Baltic coast in Germany, for cutting leather for automotive interiors. Production at Wismar will be run by a wholly-owned subsidiary, Elmo Leather Trim GmbH, and will employ around 50 people.

At the end of 2002 the Group employed around 450 people, of which 71% worked in Sweden.

Elmo Leather is owned by investors in Nordic Capital (52 %) and investors in Accent Equity Partners (47%) and jointly by Den Danske Bank, Sydbank and Unibank (1%).