BATAVIA, OHIO — After a lackluster first half, plastics machinery sales have firmed up in the second half of 1996, said a top executive at Cincinnati Milacron Inc. Discounting pressures also have eased, said William Gruber, vice president of U.S. Plastics Machinery.
Milacron, which in 1995 sold a company-record $570 million worth of plastics machinery, is by far the largest U.S. manufacturer of such equipment.
According to the Society of the Plastics Industry Inc., shipments of injection molding machines, the largest single machinery sector, grew 4.3 percent in 1995. That followed three years of double-digit percentage growth.
Analysts say Milacron has about a 50 percent share of the U.S. market for injection molding machines.
The machinery sector has ``a certain amount of cyclical ebbs and flows,'' Gruber said.
``Our sales were off the first half [of 1996] from a year earlier in the plastics machinery business, and again, we reflected what we saw as a marked turndown in the industry,'' Gruber said. ``The industry seemed to soften last year in the second half, and softening continued throughout most of the first half of 1996. But we have seen a definite rebound in the third quarter,'' Gruber said.
He made the comments in an Oct. 16 interview, a few weeks before Milacron released its third-quarter financial numbers. Milacron reported that its Plastics Machinery Group sales increased 22.8 percent in the quarter, to $193.6 million, from $157.7 million in the year-earlier period. The third quarter ended Oct. 5.
Milacron attributed most of that gain to D-M-E Co., the big maker of mold bases and components purchased by Milacron in January. D-M-E of Madison Heights, Mich., contributed about $43 million in new sales and also accounted for a $2.4 million third-quarter increase in segment operating earnings, which reached $18.1 million, up from $15.7 million a year earlier.
But business improved even without D-M-E, Milacron said. Third-quarter growth in machinery orders increased 10 percent. Business has picked up in North America, while Europe remains soft.
Through the first nine months of 1996, plastics equipment sales have reached $474.6 million, an 8.7 percent gain from $436.7 million in the first nine months of 1995.
The Cincinnati-based company's two other segments — machine tools and industrial products — reported small sales declines in the third quarter.
Gruber said the first-half slowdown apparently affected the entire plastics machinery industry. That led to pressure for price cuts, as machine makers scrambled for business.
``But right now with the market starting to come back and firm up, I think the discounting is starting to ease off a little bit,'' Gruber said.
Gruber is marking his first full year on the job. Milacron named him to head U.S. Plastics Machinery in November 1995. He had been general manager of Milacron's Consumable Products Division. Before that, he worked in the Machine Tool Division.
Since buying D-M-E and, in 1993, Germany's Klockner Ferromatik injection molding machine business, Milacron executives have said they want to acquire more companies.
Gruber said Milacron is focused on both internal and external growth. His job is to handle internal growth with Milacron's existing machinery base, he said.
Milacron has adopted a new logo reflecting its global nature, with a stylized section of a globe.
Gruber also declined to give a unit number of how many Elektra all-electric injection molding machines Milacron has sold.
``The growth in the number of machines and what we're selling, and the penetration, it's very satisfying,'' he said.
Gruber was interviewed at Milacron's Plastics Machinery headquarters in Batavia after a meeting on coinjection molding conducted by the SPI Midwest Regional Office. Milacron hosted the session.
