(From the Jan. 23, 2012, issue of Rubber & Plastics News)
CADILLAC, Mich.—Avon Rubber P.L.C. is entering 2012 on a strong but cautious note.
The maker of rubber chemical protection masks, filters, dairy liners, seals and other products plans to accelerate its investment in new products and technologies while focusing on operational efficiencies in 2012, according to Chief Executive Peter Slabbert and Group Finance Director Andrew Lewis. The goal is to create further growth and operating margin improvement.
They expect the firm to make more progress despite an uncertain outlook for global defense spending, a primary source of Avon Rubber's revenues.
Avon's Protection Systems subsidiary in Cadillac started out the year by snaring another military contract. This one is a five-year deal from the U.S. Department of Defense to produce and supply spare filters for the firm's M50 JSMPG respiratory masks.
The contract calls for indefinite delivery and quantity. Avon said the pact allows the defense department to extend the deal by two years. An initial order has been placed by the department with a value of $2.5 million for immediate delivery.
The filter is the key part of the rubber respiratory mask and, like the masks, is produced at Avon's Cadillac, Mich., plant, Lewis said. The firm currently is fulfilling a $19 million order it received in October from the U.S. defense department for M50 masks.
Avon is committed to creating greater operating efficiencies in 2012, especially at its Cadillac factory, which recently was expanded to handle additional respiratory mask and filter orders, Lewis said.
On the rubber dairy liner side of its business, he said, Avon is stepping up its efforts to penetrate deeper into the markets in China, Brazil and Russia.