Hexpol A.B.'s Hexpol Compounding business has come a long way in the past five years.
The Eupen, Belgium-based business of Sweden's Hexpol A.B. posted compounding revenues in 2009 of about $260 million. But after a series of acquisitions—the largest being Excel Polymers, which brought in more than $300 million in annual revenues—along with organic growth, the compounding business saw sales reach $1.2 billion in 2014, 23 percent higher than 2013.
Compounding accounted for 92 percent of overall Hexpol sales last year, and while the firm is based in Europe, North America clearly is the dominant region for Hexpol. Overall sales in NAFTA jumped 11.7 percent in 2014, reaching $827 million, or 63.6 percent of overall Hexpol revenues. Europe, by comparison, was next at 30.6 percent, with Asia accounting for the rest.
Donald Picard, Hexpol's vice president of sales and marketing for North America, answered questions from Bruce Meyer, Rubber & Plastics News executive editor, to put in perspective Hexpol's position in the market, some recent acquisitions and future plans. The following is an excerpt of that interview.
How did some of your recent acquisitions come about, and what does Hexpol gain from each?
With each acquisition, we get people, legacy brands, technology and product development know-how. Our interest is to be the long-term leader in our field, to be the most innovative and to always be solution-oriented. The goal is a full product offering served by world class, regional manufacturing campuses, supported through small, fast sales service teams.
We have made a commitment to the marketplace to be the low cost provider. To deliver the best, total acquisition cost, we must employ great resources. At Hexpol, we have the very best people and well-invested campuses. Each acquisition has added greatly to these resources: from Thona to Gold Key, Colonial Rubber Works, Burton Rubber Processing, Chase Elastomers to Robbins, Kardoes and now Portage Precision Polymers. We have a complete product offering and the ability to remove risk from the supply chain with the reach of our global sourcing.
Today, we are very global in scope and capability. But our mission is to be very local to all our customers, whether they are large or small.
We maintain a fast decentralized—but coordinated—effort across geographies, and this is the key to our responsiveness and speed.
With Portage Precision Polymers, the silicone part was key. Why is this important to Hexpol, and were there other things this deal brought to Hexpol?
The Portage Precision acquisition broadened and strengthened our presence in rubber compounding in North America, in terms of both capability and resource. The years of experience and seasoned personnel—especially in compound development—has greatly added to our core strength.
Regarding capacity, the silicone rubber mixing unit in Mogadore, Ohio, expands our product portfolio, and our customers have been asking for a silicone solution for quite some time now. This Ohio campus, technology and recipe portfolio provides a launching pad from which we will expand and include silicone mixing at Santa Fe Springs, Calif., and Kennedale, Texas. Like with all other parts of our business, we want to be close to our customers. This gives us the know-how from which to get started. And the market response thus far is very positive.