CLEVELAND — M.A. Hanna Co., fresh off record sales of $2.2 billion in 1997, will review the alignment of its plastic compounds and colorant plants this year.
The Cleveland-based compounder and distributor posted a 6.5 percent sales jump in 1997, surpassing both the gross domestic product and plastics industry growth, Hanna Chairman and Chief Executive Officer Douglas McGregor said at the company's annual meeting May 6.
``As the company's mix becomes more diverse, the measurement of the total company's growth vs. the plastics industry becomes less meaningful,'' McGregor said. ``Therefore, we may be required to define our growth simply vs. overall [GDP] levels in the future.''
Hanna expects the realignment to save it more than $3 million next year.
McGregor declined to specify how plant alignment would be changed, but pointed out the company already has downsized its Dyersburg, Tenn., facility by routing lower-volume orders to plants in Houston and Bethlehem, Pa. Hanna also closed a thermoplastic elastomer plant in North Ridgeville, Ohio, late last year.
``It's no secret that our color business continues to be under pressure,'' McGregor said. ``We have to see if we need as many plants as we have or if we need to change what we do and how we do it.''
Hanna's international operations also set a record last year by accounting for 22 percent of the company's overall sales. This direction will continue later this year when Hanna opens a color and additives plant in Hungary.
Hanna's high growth rate allowed it to generate $241 million in total return to shareholders last year. Company officials said that number exceeds the $148 million return averaged by a group of 13 of Hanna's peers in the specialty chemicals field, including Witco Inc., Great Lakes Chemical Co., Ferro Corp. and A. Schulman Inc.
Hanna's ongoing acquisiton spree continued in 1997, when it lassoed Harwick Chemical Manufacturing Corp. of Akron, Ohio; Enviro Care Compounds of Oslo, Norway; and Sadolin Masterbatch of Glostrup, Denmark; and to form a joint venture with Techmer PM of Clinton, Tenn.
Hanna also bought Melos Carl Bosch GmbH of Melle, Germany, early this year, giving the firm its first rubber compounding presence in Europe. Overall, Hanna has acquired 24 businesses since 1986. McGregor expects the company to make ``at least one more'' acquisition by the year-end.
``We've been an industry consolidator, and if that trend continues, we expect to be in the middle of the hunt,'' McGregor said at the Cleveland meeting.