01.01.02
Location: Vancouver, Canada
Sales: $70 million
Description: Key Personnel
Dieter Peter, Chairman & CEO; Rolf Hoevelmann, president and COO of Europe; Jay Whitman, vice president, CFO and secretary; Miles Lauzon, executive vice president of manufacturing, COO of Americas; Ken Squires, vice president, customer service
Plants
Gatineau, Quebec; Thurso, Quebec; Charleston, SC; Falkenhagen, Germany
ISO Status
2001 certification of ISO 9001, Falkenhagen
Processes
Airlaid, thermal bonding, chemical bonding, hybrid bonding, hydro compression bonding
Brand Names
CelluWeb, SmartCore
Major Markets
Feminine hygiene, adult incontinence, baby diapers, swimwear, training pants, wipes—premium baby, household, specialty industrial, homecare, food packaging, medical, tabletop
Despite continuing problems in the global airlaid market, particularly on the commodity side, Concert Industries, Vancouver, British Columbia, Canada, has undergone a series of initiatives to improve its business in recent months. After spending the past several years expanding its operations—in 2001 the company spent more than $61 million (CDN$95 million) on new assets and investments—the company continues to focus on streamlining its business and targeting the 83,000 metric tons in annual rated capacity of airlaid materials it produces each year into existing and new end use markets.
So far this strategy has worked. The company’s total roll goods sales increased 27% in 2001 to reach $70 million (CDN$109 million). Much of this sales increase can be attributed to the capacity expansion at its Concert GmbH facility in Falkenhagen, Germany, which was completed in 2000 and fully reflected in the 2001 results, as well as the global expansion of Concert’s new facility in Gatineau, Quebec in May. The backbone of the new 310,000 square foot facility in Canada is two 2.7 meter wide airlaid lines with a total 38,000 metric tons of annual rated capacity. Additionally, the company has fully incorporated ACI, Charleston, SC, which was purchased in May 2000 for a reported $19 million, into its overall business. Executives expect Concert’s sales to grow even higher in 2002, partially through a three-year $17 million (CDN$27 million) sales contract with a North American consumer products company. Finalized in June, this contract enlists Concert to provide advanced airlaid materials from the Gatineau site. Concert chairman and CEO Dieter Peter called this contract the culmination of a strong effort from the company’s sales team and said it represents the broadening of airlaid material’s opportunities.
The wipes market continues to be a strong growth area for airlaid materials, particularly in North America where they are the preferred substrate for many applications. Other areas of interest to Concert include feminine hygiene, adult incontinence, food packaging and filtration.
While executives remain optimistic about the future, the current state of the airlaid market has brought some difficulties for Concert. The weakened economy, coupled with excess capacity and pricing pressures in the commodity sector of the airlaid market, led Concert to initiate temporary plant shutdowns in January and February. Three of Concert’s four North American operating lines were shut down for rotating two-week periods beginning in mid January. The lines resumed normal operation in late February and are now operating 80 hours per week. The company continues to monitor the North American airlaid market and will adjust operating schedules as required.
While the airlaid market continues to be a challenge in North America, executives expect this situation to abate by the end of 2002 as the market continues to absorb excess capacity, the economy improves and the new lines in Canada become more efficient and take on more of Concert’s core airlaid business. Concert executives expect the company also to benefit from the significant amount of activity currently going on in its product development groups. The company has completed a number of new product trials and has others in progress that are expected to result in new sales opportunities in late 2002 and 2003.
Executives also definitely expect the North American plants to benefit from improvements to its operations. Now that the Gatineau site is complete, a significant portion of Concert’s Thurso production was relocated there to take better advantage of Gatineau’s larger economies of scale. Meanwhile, Thurso will be responsible for smaller and more specialized production runs. Concert is reportedly developing existing markets that will take advantage of Thurso’s unique ability to produce complex airlaid materials.
The European airlaid market has not bore the same problems as North America. In fact, demand is outpacing production levels at Concert’s site in Falkenhagen, Germany, which was upgraded in late 2001. The improvements, which caused a short scheduled shutdown in December 2001 of one of the facility’s two production lines, are expected to improve operating efficiencies and lower waste, leading to improved profitability in 2002.
In addition to capital improvements, acquisitions and new market penetration, Concert has been revamped in terms of key personnel. In January, the company appointed Rolf Hoevelmann as its new president. Mr. Hoevelmann, who most recently served as general manager of Concert GmbH, has worked for the company since 1996 and was instrumental in the start-up of the German subsidiary. February was marked by additional staff changes at Concert. Rusty Ables was named general manager for AA-Tech Systems and AA-Tech Canada, Concert’s 100% owned advanced airlaid technology engineering subsidiaries. Also at this time, Morten Hansen was named vice president of research and development for Concert’s Omega airlaid products; Ludwig Langer was named vice president, global quality assurance coordinator and Scott Barton was appointed to the position of vice president of information technology. Most recently, Jay Whitman was named chief financial officer of Concert in July. He replaced Carey Edwards who left the company to pursue personal interests.
In corporate news, Concert completed equity financings exceeding CDN$50 million. The majority of these funds were used to consolidate its subsidiaries into one cohesive group. After purchasing a 24.9% stake in its German subsidiary, Concert GmbH, in June 2001, and a 47.5% stake in Concert Airlaid, Gatineau, Quebec, in July 2001, Concert achieved full ownership of the German facility in February. The purchases have allowed Concert to achieve its goal of fully owning all of its subsidiaries. This new ownership structure allows for strong ties between management and operating teams and with customers, according to executives. It not only facilitates improvements in operating efficiencies by sharing best practices but also the accomplishment of its global strategies and future objectives.
Also, in May, Concert offered, by way of public offering, 8.5% convertible debentures for gross proceeds of $25 million. The company will reportedly use the proceeds of this sale to fund the development and installation of two second generation (Gen_2) festooners at its Falkenhagen site. Festooners allow airlaid materials to be packaged in bales rather than rolls and is the preferred method of packaging thicker materials due to storage space and transport costs, according to executives.
Concert was always in the forefront of the development of festooning technology for airlaid applications and has developed its first generation (Gen_1) and now the advanced Gen_2 festooner, according to company executives. The Gen_2 festooners are expected to overcome a patent dispute Concert is currently involved in with its main competitor and will allow Concert to offer festooned materials worldwide to all airlaid material converters.
Sales: $70 million
Description: Key Personnel
Dieter Peter, Chairman & CEO; Rolf Hoevelmann, president and COO of Europe; Jay Whitman, vice president, CFO and secretary; Miles Lauzon, executive vice president of manufacturing, COO of Americas; Ken Squires, vice president, customer service
Plants
Gatineau, Quebec; Thurso, Quebec; Charleston, SC; Falkenhagen, Germany
ISO Status
2001 certification of ISO 9001, Falkenhagen
Processes
Airlaid, thermal bonding, chemical bonding, hybrid bonding, hydro compression bonding
Brand Names
CelluWeb, SmartCore
Major Markets
Feminine hygiene, adult incontinence, baby diapers, swimwear, training pants, wipes—premium baby, household, specialty industrial, homecare, food packaging, medical, tabletop
Despite continuing problems in the global airlaid market, particularly on the commodity side, Concert Industries, Vancouver, British Columbia, Canada, has undergone a series of initiatives to improve its business in recent months. After spending the past several years expanding its operations—in 2001 the company spent more than $61 million (CDN$95 million) on new assets and investments—the company continues to focus on streamlining its business and targeting the 83,000 metric tons in annual rated capacity of airlaid materials it produces each year into existing and new end use markets.
So far this strategy has worked. The company’s total roll goods sales increased 27% in 2001 to reach $70 million (CDN$109 million). Much of this sales increase can be attributed to the capacity expansion at its Concert GmbH facility in Falkenhagen, Germany, which was completed in 2000 and fully reflected in the 2001 results, as well as the global expansion of Concert’s new facility in Gatineau, Quebec in May. The backbone of the new 310,000 square foot facility in Canada is two 2.7 meter wide airlaid lines with a total 38,000 metric tons of annual rated capacity. Additionally, the company has fully incorporated ACI, Charleston, SC, which was purchased in May 2000 for a reported $19 million, into its overall business. Executives expect Concert’s sales to grow even higher in 2002, partially through a three-year $17 million (CDN$27 million) sales contract with a North American consumer products company. Finalized in June, this contract enlists Concert to provide advanced airlaid materials from the Gatineau site. Concert chairman and CEO Dieter Peter called this contract the culmination of a strong effort from the company’s sales team and said it represents the broadening of airlaid material’s opportunities.
The wipes market continues to be a strong growth area for airlaid materials, particularly in North America where they are the preferred substrate for many applications. Other areas of interest to Concert include feminine hygiene, adult incontinence, food packaging and filtration.
While executives remain optimistic about the future, the current state of the airlaid market has brought some difficulties for Concert. The weakened economy, coupled with excess capacity and pricing pressures in the commodity sector of the airlaid market, led Concert to initiate temporary plant shutdowns in January and February. Three of Concert’s four North American operating lines were shut down for rotating two-week periods beginning in mid January. The lines resumed normal operation in late February and are now operating 80 hours per week. The company continues to monitor the North American airlaid market and will adjust operating schedules as required.
While the airlaid market continues to be a challenge in North America, executives expect this situation to abate by the end of 2002 as the market continues to absorb excess capacity, the economy improves and the new lines in Canada become more efficient and take on more of Concert’s core airlaid business. Concert executives expect the company also to benefit from the significant amount of activity currently going on in its product development groups. The company has completed a number of new product trials and has others in progress that are expected to result in new sales opportunities in late 2002 and 2003.
Executives also definitely expect the North American plants to benefit from improvements to its operations. Now that the Gatineau site is complete, a significant portion of Concert’s Thurso production was relocated there to take better advantage of Gatineau’s larger economies of scale. Meanwhile, Thurso will be responsible for smaller and more specialized production runs. Concert is reportedly developing existing markets that will take advantage of Thurso’s unique ability to produce complex airlaid materials.
The European airlaid market has not bore the same problems as North America. In fact, demand is outpacing production levels at Concert’s site in Falkenhagen, Germany, which was upgraded in late 2001. The improvements, which caused a short scheduled shutdown in December 2001 of one of the facility’s two production lines, are expected to improve operating efficiencies and lower waste, leading to improved profitability in 2002.
In addition to capital improvements, acquisitions and new market penetration, Concert has been revamped in terms of key personnel. In January, the company appointed Rolf Hoevelmann as its new president. Mr. Hoevelmann, who most recently served as general manager of Concert GmbH, has worked for the company since 1996 and was instrumental in the start-up of the German subsidiary. February was marked by additional staff changes at Concert. Rusty Ables was named general manager for AA-Tech Systems and AA-Tech Canada, Concert’s 100% owned advanced airlaid technology engineering subsidiaries. Also at this time, Morten Hansen was named vice president of research and development for Concert’s Omega airlaid products; Ludwig Langer was named vice president, global quality assurance coordinator and Scott Barton was appointed to the position of vice president of information technology. Most recently, Jay Whitman was named chief financial officer of Concert in July. He replaced Carey Edwards who left the company to pursue personal interests.
In corporate news, Concert completed equity financings exceeding CDN$50 million. The majority of these funds were used to consolidate its subsidiaries into one cohesive group. After purchasing a 24.9% stake in its German subsidiary, Concert GmbH, in June 2001, and a 47.5% stake in Concert Airlaid, Gatineau, Quebec, in July 2001, Concert achieved full ownership of the German facility in February. The purchases have allowed Concert to achieve its goal of fully owning all of its subsidiaries. This new ownership structure allows for strong ties between management and operating teams and with customers, according to executives. It not only facilitates improvements in operating efficiencies by sharing best practices but also the accomplishment of its global strategies and future objectives.
Also, in May, Concert offered, by way of public offering, 8.5% convertible debentures for gross proceeds of $25 million. The company will reportedly use the proceeds of this sale to fund the development and installation of two second generation (Gen_2) festooners at its Falkenhagen site. Festooners allow airlaid materials to be packaged in bales rather than rolls and is the preferred method of packaging thicker materials due to storage space and transport costs, according to executives.
Concert was always in the forefront of the development of festooning technology for airlaid applications and has developed its first generation (Gen_1) and now the advanced Gen_2 festooner, according to company executives. The Gen_2 festooners are expected to overcome a patent dispute Concert is currently involved in with its main competitor and will allow Concert to offer festooned materials worldwide to all airlaid material converters.