LUEBECK, Germany—L. Possehl & Co. MbH is upbeat about the prospects for recovery at its Elastomer Plant division, following a surprise 10 percent fall in net sales, to $456.4 million, last year.
The division comprises three businesses: TireTech and Mixing Group (HF Mixing, Farrel and Pomini), which both produce rubber processing machinery particularly for the tire industry, and a third unit supplying edible oil technology.
The drop in net sales across the Elastomer Plant division, compared to growth of around 8 percent in the previous year, Possehl noted in its 2016 annual report.
The reversal was despite a 3 percent rise in new passenger cars registrations—driven by Asia as well as some growth in western Europe—and a "moderate" increase in global demand for replacement tires.
The German industrial group linked the dip in sales partly to a "cooling of demand in individual product areas" and a reallocation of orders into the new year, particularly at U.S.-based Farrel Corp.
The decline "is not a long-term development," Possehl said, pointing to incoming orders in 2016 of $471 million, 3.3 percent above reported sales and at the same level as the previous year. Order backlog, it added, grew 4.5 percent year-on-year to $375 million.
Possehl also was encouraged by the performance of the TireTech business unit in 2016, noting a year-on-year doubling of incoming orders for the tire-building machines produced at its Hamburg-Harburg facility in Germany. This increased workflow, though, was largely due to a single major order.
The Luebeck-based group went on to report an investment to expand the capacity of its plant in Slovakia in 2016. This followed the relocation of extrusion systems manufacturing there in the previous year.
Also strong demand for tire-heating presses, led to expansion last year at its Croatian plant, which is now capable of producing up to 50 presses a month.