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Welex seeing strong call for equipment

By: Bill Bregar

February 27, 2013

BLUE BELL, PA. -- Over the last 18 months, Welex Inc. has shipped 85 pieces of machinery — extruders, takeoff units, winders and other equipment, according to President and CEO David Schroeder.

The demand reflects strong business coming out of the recession. But Schroeder said that, even during the downturn, when many industrial machinery sectors got hit by 50 percent declines, Welex held its own and avoided taking the beating.

"This company has pretty consistently maybe fluctuated by 10-15 percent, but it was by no means devastated by what took place," Schroeder said in a recent telephone interview.

Welex's business is split about 50-50 between North America and the rest of the world, he said. That includes South Korea, Brazil and China, where the company has sold some large multilayer lines. In December, Welex closed the sale of a PET coextrusion line in Saudi Arabia that will pump out 9,900 tons of sheet a year.

Multilayer coextrusion sheet lines have been popular in all geographic regions. Welex has sold more than 55 complete sheet lines in the past five years, and more than half of those have been multilayer. And Schroeder said more than 80 percent of sales come from complete lines — which take pellets all the way to finished sheet — an indication that Welex is strong in turnkey systems.

Coextrusion can create sheet with a barrier layer, to make thermoformed single-serve packaging for oxygen-sensitive foods such as applesauce.

Welex employs about 50 people at its headquarters in Blue Bell and manufacturing operation in Greenville, N.C. The company does not release dollar sales figures.

Schroeder, who has a packaging background, joined Welex in mid-2011. He came to Welex from Constar International LLC, where he was senior vice president of sales and marketing. He worked for a dozen years at Tetra Laval Group, including a stint at at blow molding equipment maker Sidel Inc. as vice president of sales and marketing, and as vice president for North America.

He said Welex has worked to partner more closely with customers, including sheet extruders and thermoformers. The company hired Jim Stangé as service sales manager. His job is to visit customers and see how the Welex equipment is running, and help with any upgrades, modifications or new controllers.

"We've proactively gone out to our customers," said Hayes Stripling, vice president of sales for the Americas.

Schroeder said Welex now refurbishes older sheet lines in the Greenville factory.

Schroeder also has done what he termed some "housecleaning," at Welex. In December, GoIndustry DoveBid conducted an online auction of excess inventory in the Greenville factory, including screws, gearboxes, transmissions, motors, pumps and sheet dies.

"The objective really was to clean up the shop and to get rid of inventory that was not relevant," he said. Some components were more than 15 years old.

Looking ahead, Schroeder is optimistic about plastics machinery sales this year. The accelerated depreciation for capital purchases got buyers off the fence in 2012, but sales slowed down a bit during the hotly contested presidential election.

Sheet extruders are ramping back up now in early 2013.

Big packaging consolidations remain a wildcard. Last year, the blockbuster was Dart Container Corp. buying Solo Cup Co. It takes awhile to determine if merged companies will move existing machines around, keep plants open or invest in new equipment, Schroeder said.