Nonwovens Industry
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PGI



Published January 1, 2005
Related Searches: Hygiene Automotive Roofing Household Wipes
Location: N. Charleston, SC

Sales: $845 million

Description: Key Personnel
James Schaeffer, chief executive officer; Willis (Billy) Moore, III, chief financial officer; Mike Hale, vice president & general manager—U.S. Nonwovens; Rolf Altdorf, vice president and managing director—Europe; Fernando Espinosa, vice president and general manager—Latin America; Jay Cheng, vice president and general manager—China. Rick Ferencz, vice president, engineering and development; Bob Dale, vice president, sales and marketing—U.S. nonwovens; Dennis Norman, vice president—strategic planning and communication.

Plants
Landisville, NJ; Rogers, AR; Benson, NC; Gainesville, GA; North Little Rock, AR; Mooresville, NC; Waynesboro, VA; Neunkirchen, Germany; Cuijk, The Netherlands; San Luis Potosi, Mexico; Buenos Aires, Argentina; Bailleul, France; Nanhai, China; Cali, Colombia; Molnlycke, Sweden

ISO Status
Landisville, NC; Rogers, AR; Vineland, NJ; Benson, NC; Gainesville, GA; North Little Rock, AR; Mooresville, NC; Waynesboro, VA, Nanhai, China, Buenos Aires, Argentina; San Luis Potosi, Mexico, Molnlycke, Sweden, Istanbul, Turkey and Cuijk, The Netherlands are ISO 9002 certified

Processes
Spunbonded meltblown, SMS, composites, through air bonded, adhesive bonded, resin bonded, thermal bonded, spunlaced, airlaid, apertured film, film laminates, sonic laminated, thermal laminated, Apex, other proprietary fabric forming, surfacing and binding systems

Brand Names
Apex, Agribon, Amira, Aquapex, Bonlinn, Bonsec, Chix, Chux, Comfortlace, Comfortsilk, Duralace, Durapex, Dura-Tex, Freeswell, Isolite, Keybak, Kiara, Masslin, Matline, Medisoft, Multi-Strike, Poly-Breathe, Poly-Safe, Provira, Reticulon, Reforel, Softlin, Soft-Touch, SuperSoft, TopSwell, Thermoform, Thermospost Ultra Dryloft, Titan, Ultra-Ply, Xiora

Major Markets
Agriculture, apparel, automotive, battery separator, cable wrap, filtration, home furnishings, hygiene, industrial, industrial and marine sorbents, medical, packaging, thermal barriers, wipes for cleanroom, food service and specialty end uses, consumer wipes, household wipes

Continuing its upward trend is PGI Nonwovens, which has been able to significantly grow not only its sales but also its earnings during the past two years, thanks to a company-wide focus on streamlining the business and focusing on core strategies and growth areas. In 2004, the N. Charleston-based company increased its nonwovens sales to $845 million on the heels of increased spunlaced sales in North America and a new line serving hygiene and industrial markets in Mexico. Profits increased 13.4% to $153.5 million.
 
“We have broken into the black and we really feel good about our situation,” said James Schaeffer, chief executive officer. “There are a lot of good things working in our favor.”
 
In March 2003, PGI implemented a multi-pronged strategy to improve its business. Points of this strategy included focusing on four core segments—hygiene, medical, wipes and industrial—growing in certain geographical regions, streamlining manufacturing processes, relying on customer-driven innovation and forming long-term partnerships. Mr. Shaeffer said he has seen a dynamic shift in how this strategy is implemented during the past three years. “In 2003, we focused on stabilizing our business, 2004 started an improvement period and in 2005 we are seeing a growth phase that has just begun,” he said.
 
Vital to this growth is a string of new investments announced during the past several months that span the globe. In September 2004, PGI unveiled plans to double spunbond fabric capacity at its facility in Cali, Colombia to meet growing demand for its products in Latin America, where PGI holds the leading marketshare in the hygiene sector. This new Reifenhauser Reico IV spunbond line will be fully dedicated to the hygiene market, providing high quality fine denier topsheet and other materials for use in diapers. PGI has been operating the Cali site, which currently houses one spunmelt line and one through air bonding line, since 1999, and expects the new line to come onstream by the fourth quarter of 2005.
 
The new line marked the second installed by PGI during the past several months. A similar line came onstream in San Luis, Potosi, Mexico, in late 2003. This new line features three-beam spunmelt technology and produces lightweight materials for hygiene markets in North, South and Central America, according to executives.
 
Meanwhile, in North America PGI is in the process of adding a fourth spunmelt line in Mooresville, NC to meet demand for its products in this region. This line will also be a Reifenhauser Reico IV spunmelt line, specifically designed for enhanced flexibility. It will provide customers with high quality fine denier materials that are softer and lighter than products available from conventional technology and have improved barrier qualities. Additionally, this line will be capable of proprietary processes and will offer advanced treating systems.
 
Looking east, PGI has also stepped up to the plate in China, where this March it implemented two major growth initiatives. The first, a new Suzhou manufacturing plant, will make PGI the largest spunmelt producer in the country as well as China’s only vertically integrated producer of medical fabric. Located near Shanghai, the new plant will house a new state-of-the-art, multi-beam Reifenhauser spunmelt line targeted primarily at serving medical and hygiene markets. It will also house a world-class finishing line capable of providing customers with treated medical fabrics produced in a pristine environment that meet the highest quality standards. Construction was set to begin during the second quarter of 2005 and commercial production is planned for mid 2006.
 
PGI will also expand its technology base at its current facility in Nanhai, China, where it operates one sold-out spunbond and one sold-out spunmelt line, with an advanced chemical bonding line serving hygiene and medical markets. This will allow PGI China to include sublayer products for the hygiene market previously available only in its U.S. and European operations.
 
Upgrades to PGI’s Chinese medical business follow its customers’ movement to China in recent years. In order to better serve these converters, PGI needed to grow operations there, according to Mr. Schaeffer. And, the hygiene market is nearly as big as medical in China, at least for PGI. Offering value-added products to increasingly savvy consumers will only boost PGI’s business there.
 
While Latin America has been PGI’s star growth area in recent years, with sales increasing from $11.2 million in 1994 to $128.9 million last year, China is expected to be the hot spot of tomorrow with growth in excess of 8% during the next five years expected by industry analysts. The company’s two existing Nanhai lines have been sold out for more than two years.
 
The new spunbond lines, in Latin America, the U.S. and China, will largely serve the hygiene market, which is facing a tight spunbond supply due largely to both market growth and the growing amount of nonwovens used per diaper. Another core growth area for PGI is wipes, where the company earmarked 40,000 metric tons of its spunlace and Apex technology in April 2004. In this market, PGI has focused on adding three-dimensionality to wiping substrates in response to converter needs for more sophisticated products, particularly in baby care products. While a great deal of spunlaced capacity is set to come onstream in North America during the next 12 months, PGI executives are not concerned because they feel their capabilities are “head and shoulders” above the rest due to their proprietary Apex technology.
 
Beyond hygiene, wipes and medical, PGI has a strong focus on its industrial business where its products include acoustical headliner materials for automotive uses to concrete fibers and packaging material and furniture and upholstery fabrics to filtration media. Recent advances, in fact, have largely centered on the filtration market where PGI has been applying its Apex technology. Most recently, the company expanded the presence of its Durapex filtration media into industrial baghouse filters for dust removal in humid conditions and high temperatures. Through a strategic relationship with Donaldson Company, use of Durapex has expanded to the newest product offerings in Donaldson’s Dura-Life baghouse line. The two companies joined together a year ago to produce industrial filter bag media that help companies meet new Environmental Protection Agency air quality standards for particulate matter.
 
Other new air media products include oleophobic bags for enhanced cleaning of wet and oily dust in cement, food, agriculture and other industries and an aramid version that provides superior filtration in temperatures up to 400°F for use in furnaces.
 
On the liquid filtration side, PGI has introduced Aquapex, for the pool and spa market where cartridge filters are rapidly replacing sand and diatomaceous earth as the filter of choice.
 
Another recent development in the industrial market includes a family of moldable polyester fabrics to be used as backing material in luxury cars and a family of flame retardant fabrics that meet California fire codes for fire resistant mattresses and other home furnishings.
 
In 2004, PGI focused on building and construction in North and Latin America where the concrete fiber business was a significant source of growth for PGI’s industrial business. The result was increased production and expanded distribution and sales networks as well as the introduction of its own QC technology and automated delivery system to the market. The company also continued to expand production of its Genesis SF Fibers and Strux through a relationship with W.R. Grace. These new product introductions were key to growth in construction and roofing membranes but existing products such as PGI’s housewrap lines also experienced strong volume growth throughout Canada, the U.S. and Mexico where they continued to gain overall marketshare.
 
In Europe, PGI’s Geca-Tapes unit, whose products include state-of-the-art nonwoven water blocking tapes and yarns and separating tapes, focused on developing clear relationships with key players. Leveraging strong customer relationships, this unit introduced a number of new products, leading directly to a strengthened market position. In 2005, its focus will be on extending its product range.
 
And, in Latin America, the company has developed its agricultural markets with its proprietary Agribon and Agriban crop covers targeting Latin American growers. These products allow improved crop yields without the need for pesticides.
 
“We have made a broad-based initiative in this segment and there is a good pipeline of products underway,” Mr. Schaeffer said. “We have really focused on the engineered solution side of things as well as on emerging trends.”