(From the Oct. 15, 2012, issue of Rubber & Plastics News)
TRENTON, N.J.—Specialty hose maker Home Rubber Co. has upgraded its operation across the board and improved its financial base.
The manufacturer of mechanical and industrial rubber products in early October successfully completed a wholesale recapitalization of its business, said Rich Balka, owner and president of the Trenton-based company. The firm retired a significant portion of its debt in the process, and secured generous new financial facilities for revolving capital expenditures and its operating line of credit, he said.
Home Rubber also is adding a calender line, which replaces an old one, and is rebuilding one of its mixing lines to expand its capabilities at its 65,000-sq.-ft. plant in Trenton. Both projects are expected to be finished within the next week to 10 days.
In addition, Balka said the firm recently completed a number of major projects at the factory, improving its infrastructure, upgrading production efficiencies and reducing energy costs.
Financial details of the capital expansion projects weren't released.
“In an era when banks don't want to loan money to small businesses, the strength of American manufacturing over the past year helped us to bolster our balance sheet and convince a new lender that 130 years was only the beginning,” according to Balka.
The recapitalization came shortly after the factory upgrading projects were concluded and a new line was being added while another was close to completion, which, he said, “really puts us in good shape to fulfill our mission of providing innovative solutions and small run products to our customers in a fraction of the lead time experienced in the industry.”
Balka said the recapitalization will allow the company to maintain a strong raw material inventory, increase its inventory of tan pure gum tubing and meet any needs customers require. It also creates the opportunity for more capital improvements down the line and improves the firm's cash flow.
In addition, he said, stronger cash flow makes it easier and quicker for the firm to react when there's a need to move quickly for a customer.
While Home Rubber is planning to make more infrastructure improvements in the future, Balka didn't give details of what is involved in those projects or when they will be launched.
The manufacturer has a broad range of manufacturing capabilities that include handmade hose and tubing, lathe cut gaskets, sheet goods, mandrel-made endless belting, and other specialty rubber products.
Its Ivanhoe division—formerly Ivanhoe Rubber Co., which was purchased by Home Rubber in October 2006—produces technically specific small batch rubber compounds to molders and extruders in slab and various preforms.
Overall, the company has a wide product breadth because that's what the markets it serves call for, and the firm has the capabilities and wherewithal to fill virtually any need, the executive said.
Balka said business within every division of the company was good in the first half of 2012 but began to slow down around Labor Day. “We still have a good backlog of orders,” he said, “but across the industry, it's become slow. I view it as a blip, not a permanent downturn.”
The steel industry remains robust and the primary business segment the company services has continued to grow steadily, especially furnace doors for which Home Rubber continues to supply hoses with resistant covers, he said.