12/12/2014 Updated 12/14/2014

Semperit unveils third expansion of 2014

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By Mike McNulty

VIENNA, Austria—After recording relatively strong results for the first nine months of 2014, Semperit A.G. has unveiled another expansion project, the third it has launched this year.

Officials at the company's Semperform business said in mid-November the business will invest about $8.7 million to modernize the production operations at its Wimpassing plant in lower Austria.

This represents a continuation of the Semperit Group's extensive expansion and modernization project at the factory, the firm said. Between 2012 and 2015, more than $50 million will have been invested in the facility, it said.

An expansion is needed to install a new Ultra High Frequency technology line at the plant that “will enable us to strengthen the leading market position of Semperform and create the basis for future growth,” according to Thomas Fahnermann, CEO of Semperit A.G. Holding.

The first of three new UHF lines is currently in the start-up phase at the factory and will be converted to its regular operations over the next few months.

Production advantages

Because of the uniform heating of rubber mixtures, the UHF technology offers considerable production advantages, Semperit said, especially for profiles with a medium or high wall thickness. It's particularly suited for aluminum windows, the firm said, and in the future, Semperform will serve the market as a provider of sealing profiles.

When fully installed, the three lines will process more than 6,000 metric tons of raw rubber mix annually into rubber profiles.

A spokeswoman said no details were available yet on when the next line will be installed or when the project is expected to be completed.

“We are rounding off our product portfolio in existing market segments and tapping new customer groups in construction and industry,” Fahnermann said. “The investments also comprise a clear commitment to the Wimpassing site and a further step toward achieving our strategic growth targets.”

Semperform is part of Semperit's Industrial sector, where two other expansions are underway: a $13.6 million investment to boost manufacturing capacities for hydraulic and industrial hose at its Odry, Czech Republic, facility; and an addition to its conveyor belt plant in Belchalow, Poland, at a cost of about $52 million.

Meanwhile, Semperit's Sempermed segment is expanding production capacity for examination and protective gloves at its operation in Kamunting, Malaysia.

It is currently investing about $62.7 million in the construction of a new glove plant on the site in Kamunting, where the company has operated six medical and protective glove facilities since it acquired Latexx Partners Bhd. in 2012.

It expects to begin producing its first gloves at the new factory in the middle of 2015, with the construction project slated for completion at the end of 2016, the spokeswoman said.

Fahnermann said the new factory will feature state-of-the-art technologies “as the basis for a high level of automation and the optimal use of natural resources. It will be one of the world's most efficient manufacturing plants for nitrile gloves.”

Satisfactory performance

Semperit's group of businesses grew in the first nine months of 2014 despite a difficult economic environment. The firm said it expects a largely stable order situation for the remainder of 2014 and a satisfactory performance in both revenue and earnings compared to 2013.

The company reported a 2 percent increase in revenues to $876.3 million for the first nine months of 2014 over those it posted for the like period last year.

Earnings after taxes, however, fell to $49.7 million from $55.8 million.

For the third quarter, sales rose slightly to $293.6 million from $292.4 million last year, while earnings dropped to $14.8 million from the $20.3 million recorded a year earlier.

Its largest single segment, the medical sector, had a sales increase of a little less than 1 percent to $457.1 million for the year thus far while the industrial sector—made up of the company's Semperflex, Sempertrans and Semperform operations—had sales of $457.1 million, up 3.1 percent from last year's revenues in the first three quarters.