Industrial Rubber Products Inc. is expanding its urethane products operation at one of two plants in Hibbing, Minn., following consolidation of the division and sale of its Irathane plant in Colorado Springs, Colo. The firm also is temporarily adding workers to match increased sales and manufacturing needs. Those posts could become permanent if sales continue to rise, Chief Financial Officer John Kokotovich said.
Industrial Rubber has been consolidating since November, when it said it would close its Colorado Springs urethane facility and unite the division with its unit in Hibbing. It also eliminated some administrative positions, although it did not give the number. The firm estimated it would save about $1 million with the moves.
After it transferred machinery and one employee from Colorado Springs to Hibbing, Industrial Rubber added "a few thousand square feet to our Hibbing urethane operation," Kokotovich said.
The company had used 30,000 of the building's 45,000 square feet for urethane manufacturing and leased the remaining space to another business. It added close to half the remaining 15,000 square feet in the past few weeks and probably will take over the whole building by year-end, he said.
Industrial Rubber, which suffered several losses in the past few quarters, returned to the black in the first period of 2000, ended March 31, with profit of $170,515 compared with a $226,366 loss in the quarter last year. Sales more than tripled, to $5 million from $1.6 million.
Included in the firm's results was $215,970 in expenses related to closing the plant in Colorado Springs and a $201,576 gain on the sale of the facility and property, finalized March 31.
The Irathane division manufacturing consolidation is scheduled to finish by the end of May or early June. "When completed, this consolidation will have a favorable impact on our operating performance," President and Chief Executive Officer Daniel O. Burkes said.
The unit makes urethane pipe, cast elastomer and liquid urethane products.
Industrial Rubber's other plant in Hibbing manufactures rubber products and has about 38 employees.
"All of the manufacturing machinery in service in Colorado Springs is now in use at our Hibbing urethane plant," Kokotovich said. "We now have about 35 production people at Irathane. We had been as low as 20 late last year and had to add people because of increased sales and extraordinary backlogs.
"The only person who transferred from Colorado Springs to Hibbing was the production manager. Our employment level could settle back to the 20s. But if sales continue to peak, we'll end up hiring more people even though we are becoming leaner and more efficient."
Industrial Rubber uses a third facility in Hibbing as a temporary warehouse for storage of its molds, he said, but it plans on selling the building. It also has plants in West Jordan, Utah, and Sudbury, Ontario.
The company designs, manufactures and markets protective materials, abrasion-resistant products and equipment, along with erosion/corrosion protective linings and proprietary rubber products for mining applications in the United States and Canada.