Rogers Corp., Silicone Engineering see parallels, not redundancies

ORLANDO, Fla.—When a company as large as the 6,000-person Rogers Corp. makes an acquisition, redundancies can be inevitable as product lines overlap and portfolios merge.

To date, Rogers and its subsidiary, Manchester, England-based Silicone Engineering Ltd., have avoided such a superfluous relationship in the silicone world, as Rogers and its Bisco and Arlon lines serve separate sets of customers from Silicone Engineering's work in HCR.

Rogers, based in Chandler, Ariz., acquired the 130-person Silicone Engineering in 2021.

"Right now we are in the process of streamlining our portfolio," Nadine Dytko-Madsen, product line manager for Rogers Corp., told Rubber News at the recent Gasket Fabricators Association Expo in Orlando. "If you go to a restaurant with a one-page menu and it is all excellent, that is what we are striving for—rather than the five-page menu with varying levels of qualities and specs.

"This creates superfluous offerings between brands, with different processing points and specifications. We are trying to position our products appropriately to where the market needs are—and we want to be best-in-class in all of them."

Dytko-Madsen said portfolio stratification can be a challenge.

"We don't want to lose business because we have offerings that are confusing," she said. "And this is something that we can directly control."

As a specialty engineered materials firm, Rogers is massive, comprising four main business units, including the Elastomeric Material Solutions division under which Silicone Engineering (as well as the Bisco, Arlon and DeWal lines) exists.

Two of Rogers' other large acquisitions have been Arlon, a provider of high frequency circuit materials and engineered silicones (2015); and DeWal Industries, a manufacturer of high-performance polymer films and pressure sensitive tapes (2016).

Silicone Engineering's path to Rogers came after stints under Meggitt and Parker-Hannifin.

The HCR firm that began in 1959 in Blackburn, England, just outside Manchester, sees about 70 percent of its sales come via calendering and sheeting (HCR).

About 12 percent of sales come via sponge extrusions (SE's Expansil line), and another 12 percent through solid extrusions (SE's Surasil line).

A small percentage of revenues comes via insulated cable sheaths, processed through compression molding.

"Being a part of Rogers' global network and the contacts that come with that is a positive for Silicone Engineering, for sure," said Simon Holmes, marketing manager with Silicone Engineering. "It is a benefit to be able to tap into that knowledge.

"But on a granular level, we continue to formulate in-house ... and we have product lines coming through that we have not had access to before."

Holmes added that Silicone Engineering just released an FDA-approved cellular sponge for food-making machinery, including bakery ovens. And there have been ongoing innovations with its thermally conductive silicone material.

"We lean on the corporation for that testing and knowledge," Holmes told Rubber News.

As an industry supplier, Silicone Engineering does compound for its own captive use, but does not sell its formulations.

"With the raw material squeeze we saw a few years, we did have people knocking on the door," Holmes said. "But our goods are calendered rolls, this is what typically is palleted up and shipped."

Holmes noted that about 72 percent of Silicone Engineering's sales are exports to Germany, France, Italy and North America.

Its chief markets for volume are HVAC and the food and beverage segments, though the company, like its parent company, has applications in a huge range of end markets.

Dytko-Madsen noted that the Bisco suite of LSR materials also finds itself in general industrial applications, but the overlap ends there.

"Historical models tell us that where a Rogers product is designed for Bisco, it will continue with Bisco throughout the design," she said. "We are not the industry experts in sponge; we work much more in the LSR space."

The Bisco suite sees about 85 percent of its sales on the LSR side, with about 10 percent of sales in calendered solids and a final 5 percent in flame-retardant sponge for the low-volume, high-margin aerospace segment.

"Customer inventory levels are getting depleted," Dytko-Madsen said. "On the Bisco side, we are ready to take orders and process them expeditiously. And that is the first time in a long time I have been able to say that.

"The whiplash effect has stabilized, and (raw material) pricing is stable once again."

While the market is seeing greater balance today, the Rogers and Silicone Engineering representatives said challenges remain.

For Silicone Engineering, that means navigating the difficult economic waters in Germany, which many believe is entering a recession—with skyrocketing energy costs to boot.

"Germany is kind of Europe's economic barometer, like the U.S. is for North America," Holmes said. "Things have stabilized. The last two years have been crazy, but capacity is free-flowing once again with raw materials, and dare I say we are edging toward normality.

"We are close today to where we were pre-COVID."

With a possible slowdown looming in the second and third quarters of this year, Holmes said Silicone Engineering has the advantage of gleaning its raw materials from suppliers in Europe.

"We maintain a multi-supplier philosophy, but we do not rely on China or Asia," Holmes said.

Dytko-Madsen said both Rogers and Silicone Engineering maintain a constant focus on innovation, as evidenced by a pilot line established at a Rogers location in Carol Stream, Ill.

"The pilot line can bring time-to-market down considerably," she said. "It is a means to test out a new product on a baby production line. With it, we can be more nimble with customers with new specs or something that needs customized. It offers basically a proof of concept."

Sustainability remains top-of-mind for Rogers as well, according to Holmes.

"CO2 footprint and recyclability are things that we are asked about more and more," he said. Big OEMs are asking about traceability, and it remains front-of-mind for us.

"From Rogers' end, they are committed to being a leader here as well."

Dytko-Madsen said silicone's long-term reliability makes the material inherently sustainable.

"We create less waste by making the product better," she said. "With product quality the customer does not have to buy a new one every year. Single-use silicone would be a remarkably expensive product solution."