Location: Aalborg, Denmark
Sales: $160 million
Description: Key Personnel
Knud Waede Hansen, managing director; Knud Erik Justesen, deputy managing director; Jorgen Bech Masen, general manager, needlepunch division; Mikael Staal Axelsen, general manager, personal care division; Etienne Ficht, business development manager
Two in Aalborg; one in Malaysia, two in Czech Republic
ISO 9001 certified, 1991; DES ISO 14001 environmental certification, 2001
Drylaid, needlepunched, spunbond/meltblown, thermal bond
Fibertex, Matchback, Comfortback, Flexback, Two-in-One, formtex, Superflor, Alupor
Industrial textiles-primary and secondary carpet backings, automotive, furniture and bedding; technical textiles-building and construction, horticulture; hygiene; protective clothing; packaging
Benefiting from the full effects of its Malaysian line, completed in late 2003, Fibertex’s sales reached $160 million in 2004 and executives are bullish they could surpass $200 million in 2005 as a second Malaysian line ramps up and the effects of a Central European acquisition are felt.
Currently, Fibertex’s business falls under two divisions—personal care and technical which comprise 60% and 40% of the business, respectively. In 2004, personal care sales increased 32% to reach DKK546 million, thanks largely to the completion of a new spunbond line in Malaysia. Technical division sales increased 15% to DKK418 including the company’s acquisition of Czech Republic-based Vigona. Organic growth was reported at approximately 5%.
“It’s a strength for us to have two strong legs,” said managing director Knud Waede Hansen. “It’s always nice to have more than one market to observe.”
After investing significantly in personal care since entering the segment in 1998, in July 2004, Fibertex shifted its attention toward technical by acquiring Vigona, a Czech Republic-based manufacturer of needlepunched and thermal bonded nonwovens. The acquisition not only strengthened Fibertex’s technical business, it has also opened a door to the important growth markets of Central and Eastern Europe for the company.
And, Fibertex is already enhancing this business, which achieved sales of $60 million per year prior to the acquisition. In June 2005, a large-scale NSC needlepunch line measuring six meters in width began operation and plans are underway to erect some specialty lines, including a laminator, to work in tandem with the loom. The new line is located in a new plant near existing facilities in Svitavy, Czech Republic. Also included in the Vigona acquisition was a site in Opatov, which will likely be closed, according to Mr. Hansen.
The investment in the Vigona site is part of Fibertex’s strategy to increase its foothold in some important industrial markets, most notably the automotives segment, which has seen significant activity in Central Europe. In announcing the DKK35 million purchase of the needlepunch and thermalbond nonwovens producer, Fibertex officials pledged to invest as much has DKK200 million into improving the business.
In addition to automotives, other key markets receiving a boost from the Vigona business are filtration, bedding and construction. “Western Europe is an expensive production platform,” Mr. Hansen said. “Eastern Europe is much more economical so it is a good place to establish an operation.”
Investment in technical operations does not mean that Fibertex has cooled its jets in the hygiene arena. Plans are already underway to install a large-scale Reifenhaueser spunbond line—Fibertex’s fifth—in Aalborg, where Fibertex already operates two such lines.
Also contributing nicely to Fibertex’s hygiene business is its Malaysian operation, established in spring 2002. While this site’s one operating spunbond line—a second one is set to come onstream this summer—contributed only $3 million to overall sales in 2003, the line’s contribution increased significantly last year. The second spunmelt line will boast a 25% higher output than the first line.
Whether or not expansion will continue into new areas, such as North or South America, is not clear. “We are supplying North America from Denmark and Malaysia, and we have considered a line there but have not yet made a decision,” said Mr. Hansen. “We want to be a global company but we have to be careful of our manpower, making sure there are enough competitive people to support the operations and to make sure there is a market for our output. We can’t just go into a market and be like all of the others. It is not interesting.”
Beyond geographical expansion, Fibertex will achieve growth through a balance of high volume commodity markets and value-added specialty areas. In hygiene, Fibertex currently markets three major products lines—Comfort (high liquid barrier and low cost), Elite (high strength and softness) and Dual (supersoft)—focusing on applications in baby diapers, feminine hygiene and adult incontinence products. In 2004, the division continued to work on a new product line, Shape, an elasticized material based on 100% nonwoven material and directed at personal care applications. Meanwhile, on the industrial side, research and development efforts have led to products for the filtration and automotive industry, new low-weight geotextile products and laminated and multilayered products for a variety of technical and industrial end uses.
Looking ahead, raw material prices, a key concern in 2004, are expected to keep profits flat during 2005. However, continued focus on innovation in products and services will considerably increase performance in both sales and earnings in 2006.
“You have to take advantage of what is going on in the market,” Mr. Hansen said. “Timing is extremely important, and we try our best to assess this.”