A. Schulman Inc. has approved plans to build a $7.4 million compounding plant in Dongguan, China. The plant, with annual capacity of 40 million pounds on a single extrusion line, will open in early 2004.
The plant, located 50 miles northwest of Hong Kong, will serve Schulman customers in China's film, packaging and automotive markets. The Chinese plastic market is growing at a rate of 20 percent annually, officials with Fairlawn, Ohio-based Schulman said.
Schulman also recently completed a $15 million project at its Kerpen, Germany, plant that added two new extrusion lines with total annual capacity of 33 million pounds of compounds based on engineering resins. The expansion also increased the size of the plant and added a new warehouse.
The firm, which ranks as one of North America's largest compounders, also is finalizing plans to build a new plant in Poland. Schulman currently operates 15 plants in North America, Europe and Asia.
Through the third quarter of its 2002 fiscal year, which began in September, Schulman's sales dropped almost 5 percent to $712.9 million when compared to the same period in fiscal 2001.
However, its profit tripled to $21.4 million in that same period, mostly as the result of a 20 percent drop in its U.S. work force and the closing of an older, costly plant in Akron, Ohio.
``Although there will be some pressure on margins due to increasing prices of plastic resins, we expect to retain much of the margin improvement gained during the year,'' Terry Haines, Schulman president and chief executive officer, said in a July 11 news release.