Textilgruppe Hof

September 11, 2006

Textilgruppe Hof
Hof/Saale, Germany
$87 million

Key Personnel

Manfred Knieling, managing director; Harald Stini, managing director; Rudolf Scholtter, managing director; Detlev Käppel, managing director-Techtex and global sales director eswegee, technical nonwovens; Lothar Hackler, president-Hof Textiles, Inc.


Hof/Saale, Germany; Mittweida, Germany; Lincolnton, NC


Drylaid, thermal bonded, needlepunched, saturate bonded, stitchbonded

Brand Names

Variopoint, Unipoint, Unisoft, Zetafelt, Zetastitch, Zetafil, Zetawatt, Florbond, Zetabond, Zetatherm, Zetamold, Maliwatt, Malivlies, Kunit, Multiknit eswegee 2000 series, Bassopoint

With consolidated 2005 worldwide nonwovens sales topping $87 million, eswegee Vliesstoff group, Hof/Saale, Germany, saw a slight decrease in sales compared to last year. The main reason for this was a drop in sales in the Interlining division related to continued increases in imports from Asia. For industrial nonwovens, eswegee was once again able to increase sales by approximately 5% in comparison to 2004.

The company’s domestic/export sales ratio shifted slightly this year, with sales within Germany reaching 62% and exports making up 38% of the company’s overall business. Industrial markets remain the company’s core focus and represent more than 60% of its business.

In terms of the company’s current market strategy, Textilgruppe Hof is following what it sees as a trend in the global nonwovens industry and is focusing on industrial applications for the future in order to offset decreases in other segments (such as interlinings). Additionally, the company is paying much attention to investments for the future.
rn“Despite these plans,” explained Manfred Knieling, managing director, “the interlining business is still an important part of our strategic planning. We are working hard not only to stabilize revenues in 2006 but also to expand our marketshare.” He added that plans are still underway to add production in Asia for interlinings and industrial nonwovens in the near future. “More details will be unveiled soon after the deal is done,” Mr. Knieling predicted, “and our sales network will also be expanded in that region.”

In anticipation of its future plans, eswegee has strengthened its top-tier management capacity. As part of this move, Dr. Harald Stini joined eswegee’s board in September 2005, while at Hof Textiles Inc., Dr. Lothar Hackler joined the team. Their extensive backgrounds in the nonwovens industry are expected to enable the company to grow into new market segments as well.

In the interlinings sector, eswegee has increased production capacity and customized its product variety to better focus on customers’ future needs. “Our new, wide thermal bonding line in combination with the double dot lines are running at capacity,” reported Mr. Knieling.

Industrial business for eswegee remains strong with sales and production output exceeding expectations. “Raw material pricing is still the major hurdle to overcome” commented Techtex managing director Detlev Käppel. “We must also struggle to remain profitable despite continuous demand for lower prices from our automotive customers.” He added that the company has been able to achieve improvements in terms of productivity to partially balance soaring fiber and chemical prices.

“The OEMs should sometimes scrutinize their procurement strategy so that they do not end up some day in the hand of just a few Tier1/2/3s who will then bounce back in terms of pricing power. On top of that, the level of quality should also be reviewed as they even want to increase quality by lowering the price simultaneously,” Mr. Käppel warned.

Other market segments such as filtration and non-automotive-related industrial applications also report further growth compared to last year’s sales. Further expansions of new product groups and additional sales support are underway.

At Mittweida, the company’s new, wide Kunit/Multiknit production line is running satisfactorily to supply foam replacement products for car seats used by various OEMs. A new six-meter stitchbonding line is running to full capacity due to a new project the company acquired for secondary carpet backing. “We expect further growth in the future for these product groups as we are able to offer our customers higher performance for reasonable pricing compared to other products,” stated Mr. Käppel.

Capacity expansion is also planned for decorative stitchbonded nonwovens for use in headliner facing and package tray/luggage cover/trunk applications. “We are also considering expanding our capability for mechanical and thermal product finishing to enhance quality and add value,” Mr. Knieling added.

At its U.S.-based subsidiary Hof Textiles, another year of growth has been achieved in terms of sales for the industrial nonwovens division due to the completion of its investment program. Further projects with Tier1/OEMs are slated for 2006. The interlinings business at Hof Textiles remains a challenge and the company plans to develop new sales and marketing strategies to supply its remaining North American customers.

“In a nutshell,” concluded Mr. Knieling, “Hof will further concentrate on developing and customizing its products to tailor-make the best package for our customers. We will definitely not go for more volume but concentrate on intelligent products with added value. Hof has some more new market information up our sleeves for 2006 with another possible nonwoven technology we might add,” said Mr Knieling.

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