2015 Nonwovens Sales: $589 million
Dante Parrini, chairman and CEO; John Jacunski, executive vice president and CFO; Christopher Astley, senior vice president & business unit president, Advanced Airlaid Materials; Martin Rapp, senior vice president & business unit president, Composite Fibers
Canada, Germany, France, U.K., Philippines
The big news from airlaid specialist Glatfelter is the company’s decision to build a new airlaid line in the U.S. The York, PA-based company announced in December 2015 it would invest $80 million in a new production facility for its Advanced Airlaid Materials business (AMBU). In March, the company revealed it would be built in Fort Smith, AK.
“Our Advanced Airlaid Materials business is a global growth platform that has a unique opportunity to capitalize on increasing and unmet demand in North America for the materials used in lighter-weight hygiene and disposable wipes products,” says Dante Parrini, chairman and CEO. “Our plan to build this new facility is in direct response to customer needs for increased capacity in a tightening North American airlaid market.”
The new facility, which is currently under construction, is expected to have an annual capacity of approximately 22,000 short tons, which will increase the company’s total global airlaid materials capacity to 129,000 short tons. The investment, which was only finalized after a customer committed to purchase a significant amount of the capacity, will establish a specialty asset base in the U.S. and create a center of excellence for other lighter basis weight products. It will be complete in early 2018.
“We are planning to locate this facility in close proximity to several key customers and highly efficient transportation routes in the southern U.S., as well as where we have additional access to a high-quality, skilled workforce,” says Chris Astley, senior vice president and business unit president, Advanced Airlaid Materials.
The new line will be housed in a former Mitsubishi Power Systems building in Fort Smith, where Glatfelter will create up to 83 highly skilled manufacturing jobs.
Glatfelter’s new Fort Smith facility will supply products to a variety of customers, including those who support the broader wipes and hygiene markets.
“We are truly excited to partner with the people of Fort Smith and Arkansas because we know that investing here makes great business sense for our company,” Astley says. “Locating here benefits our business in a number of ways. It will enable us to expand our capacity to meet our customers’ growing demand for our advanced airlaid products, provide us with closer proximity to key suppliers and customers and link us to highly efficient transportation routes across the South. Equally important, it will allow us to tap into the area’s high quality workforce.”
In addition to the new Fort Smith facility, Glatfelter has 12 production facilities located across the U.S., Canada, Germany, France, the U.K., and the Philippines. The company, headquartered in York, PA, employs more than 4300 people worldwide.
Glatfelter’s most recent airlaid investment was a new line in Falkenhagen, Germany in 2010. In addition to the Falkenhagen site, which now contains three airlaid lines, Glatfelter has two airlaid lines in Quebec, Canada. Together these five lines make about 100,000 tons of nonwovens per year.
In 2015, airlaid sales decreased from $281 million to $244 million due to currency fluctuations. The feminine hygiene markets accounted for the majority, 74% of sales, and customers include a few large, leading consumer products companies. The airlaid wipes market, while a smaller business for Glatfelter, is growing steadily, increasing from $16 to $23 million between 2014 and 2015 and the new airlaid line will continue to boost sales in this category. Other key markets include adult incontinence and home care.
Glatfelter’s Composite Fibers business, which contains wetlaid nonwovens production, for the food and beverage wallcoverings and other specialty markets, also was impacted by currency fluctuations, decreasing in U.S. dollar terms from $617 million to $541 million.
The largest market within this business, representing about $274 million in sales is food and beverage, which primarily serves the single serve coffee and tea market. Another important business is wallcoverings, a business that was acquired from Dresden Papier inn 2013. While wallcoverings remains an important area for Glatfelter, sales in this segment have been adversely affected by socioeconomic conditions in Russia and the Ukraine, since the beginning of 2015.
In addition to its Advanced Airlaid and Composite Fibers business, Glatfelter operates a third, larger business segment Specialty Papers, which does not include any nonwovens operations. In 2015, sales of this segment were $875 million, representing about half of corporate sales. This segment has not been growing as rapidly as the other two units, largely due to Glatfelter’s strategy of increasing its exposure to engineered and fiber based businesses like nonwovens.