HAAKSBERGEN, Netherlands—VMI is set to recover from a dip in business last year, according to its parent company.
TKH Group, owner of the Dutch tire and rubber machinery maker, based its assessment partly on an improvement in order-intake in the tire-building segment, to $96.2 million, in the fourth quarter of last year.
VMI is part of the Manufacturing Systems unit, which contributed 26.2 percent of group income in 2016. The unit is positioned within Industrial Solutions, one of three divisions—alongside Building Solutions and Telecom Solutions—at TKH.
TKH posted a 2.5 percent year-on-year decline in sales in 2016 to $1.45 billion. Earnings fell 3.3 percent to $158.4 million because lower production volumes within the Industrial Solutions unit in the first nine months.
"We were able to close the year 2016 with a good fourth quarter, in which we saw a recovery of both turnover and order-intake at Industrial Solutions, in particular in the sub-segment manufacturing systems," TKH CEO Alexander van der Lof said in a statement.
As well as equipment for making car and truck tires, Industrial Solutions' portfolio includes specialty cable, plug-and-play cable systems and integrated systems. The Manufacturing Systems unit also supplies systems for producing can washers, test equipment, product handling in the medical industry and machine operating systems.
In 2016, turnover in the Industrial Solutions segment fell by 4.8 percent to $646.2 million. TKH said the decline was attributed to its Manufacturing Systems unit's reluctance to invest in China, resulting in reduced order intake.
TKH added that while order-intake in China remained low, orders from the top five tire manufacturers increased in the fourth quarter.
TKH said there are a large number of investment projects in the tire building industry, as well as considerable market interest in VMI's new MILEXX systems for truck tire building.
The group also reported solid progress with a new tire-building platform, called UNIXX.
"We will build a prototype in the course of 2017 and we expect to deliver the prototype to a launching customer in 2018," the firm said. "The start-up of the operations in Poland during 2016 went well and completion of the construction of the new plant for tire building systems in Poland is scheduled for 2017."