Southern Pipe Inc. is continuing to expand its PVC extrusion business and exploring growth opportunities, including diversification into foam core conduit and a new profile for the utility industry.
President Bob Mitchell isn't ready to disclose details on the profile. What he will say is that his 4-year-old business will add one line and an extrusion machine this year with expectations to increase sales 35 percent.
``Sales ought to be way up if price increases stick,'' Mitchell said in an April 24 interview at Southern Pipe's offices in New London.
Like other PVC pipe manufacturers, Southern struggled last year under narrow margins.
``I don't remember it ever, just continually, month after month, it didn't matter what you did, it didn't matter how much you made, it didn't matter what kind of cost-cutting measures you took ... it was terrible,'' he said.
Mitchell and his business partner Roy Stanioch selected a fortuitous time to start their business: They got their machines in, resin prices started increasing, prices increased and margins went up. But last year all PVC pipe makers seemed to struggle.
Still, things have not been so bad for Southern.
``We have grown every month, without exception,'' Mitchell said. ``We have grown in the size of production constantly.'' The first part of this year also has been promising: According to Southern, volume was up 20-30 percent in pounds sold for the first quarter compared to the same period last year.
By the end of this year or the beginning of 2003 the firm will establish another facility within a 550 mile radius of its current location, with one caveat: ``I'd say it all hinges on what happens in the market,'' Mitchell said.
``There are so many variables right now,'' Mitchell said. ``If everything was to continue as it is right now, we're in for a good year-and-a-half of solid, profitable business. If something happened on the same scale as Sept. 11, it wouldn't matter what the resin price was.''
Southern Pipe reported $16.5 million in sales for 2001 with throughput of 45 million pounds.