Fibreboard Corp. will spend $4 million to expand its Vytec vinyl siding factory in Canada, adding an extrusion line and building a 24,000-square-foot addition. Fibreboard also will expand blending and compounding at the London, Ontario, plant.
Total vinyl siding capacity will increase by 20 percent, to 140 million square feet, in London.
Fibreboard said the improvements are needed to meet expected siding demand in 1997. Sales and profit from siding have been strong so far through 1996, the company said.
By mid-1997, Fibreboard will have total capacity of about 500 million square feet of vinyl siding a year. About half of that capacity is at the Norandex siding extrusion plant in Claremont, N.C. Fibreboard recently announced it will boost capacity at that plant from 190 million square feet to 220 million square feet.
Fibreboard also has announced plans to build a third siding plant somewhere in the south central section of the United States by mid-1997. The company has not revealed a location yet.
Fibreboard, founded in the late 1800s as a lumber products company in California, got into vinyl siding by purchasing Norandex Inc. of Macedonia, Ohio, in 1994, and Vytec Corp. in 1995.
No information was available on the specific brand of extrusion system Fibreboard will purchase for Vytec or the planned factory.
``This facility expansion gives us an opportunity for increased market share and improved profitability. It is in line with our basic strategy to grow our production capacity in tandem with strong market demand,'' said John Roach, Fibreboard's chairman and chief executive officer.
In late August, Fibreboard completed the move of its headquarters to Dallas from Walnut Creek, Calif. In addition to vinyl siding, the company also makes insulation and metal jacketing for pipes, and is a major ski resort owner in California.
The company is traded on the American Stock Exchange.
The addition of Vytec, new Norandex distribution centers and a new ski resort combined to push Fibreboard's sales in the first half of 1996 to $230.2 million, a 31 percent increase from $175.3 million in the same period of 1996.
Profit companywide fell by 23 percent, to $7.69 million, from $9.99 million in the first half of 1995. The higher profit figure in 1995 reflected the wood products business, which was sold in the third quarter of the year.
Fibreboard's fiscal year follows the calendar year.
Vinyl siding accounts for about one-third of the business at the Residential Products Group. In the first six months, Fibreboard said, sales of that group grew by 43 percent, to $166.7 million, from $116.4 million in the first half of 1995. Operating profit more than doubled, to $11.4 million, from $5.6 million.
Fibreboard said the improvement in operating profit was because of lower resin costs and higher manufacturing efficiencies, plus the addition of Vytec.