A. Schulman is following up big gains in sales and profit with plans to add a new extrusion line at its plant in Brazil.
The line will be in place by November and will increase the site's overall annual production capacity by 8 million to 10 million pounds, said officials with Fairlawn, Ohio-based Schulman. The new line, the site's fourth overall, will be used to make additive concentrates and compounds based on engineering resins.
The expansion is needed because of the robust Brazilian market and its demand for materials in consumer goods, transportation and food, medical and pharmaceutical packaging, said Gustavo Perez, Schulman Americas general manager and chief operating officer, in a news release.
Schulman acquired the plant in its purchase of São Paulo-based Mash Compostos Plasticos last year. Perez added that Schulman is pleased with the success of the Mash acquisition, and we plan to continue to grow our presence in South America.
Schulman announced the capacity addition shortly after releasing financial results for the first half of its fiscal 2011, which ended Feb. 28. For the half, Schulman's sales grew almost 45 percent to just over $1 billion, vs. the same period in fiscal 2010. Profit jumped more than 60 percent to almost $17 million.
In the second quarter alone, Schulman posted sales growth of more than 50 percent; profit checked in at just over $7 million vs. a loss of almost $7 million in the same quarter in fiscal 2010.
In a news release, Chairman, President and CEO Joseph Gingo chalked up recent growth to favorable volume stemming from steady improvement in customer demand, and the mix effect as we continue to focus on more profitable businesses.
The firm has made no decision on possible jobs creation from the Brazilian expansion, or from a recent capacity expansion announced for Schulman's specialty powders plant in China, Texas, spokeswoman Jennifer Beeman said in an April 14 phone interview. New capacity is expected to be on-line in Texas by early 2012, but Beeman said Schulman has yet to determine how many new lines will be installed there.
She added that a potential agreement under which Schulman would lease a 6,000-square-foot building in Akron, Ohio, to Australian biopolymer products maker Plantic Technologies Ltd. has not been finalized. A recent news release from the Ohio Department of Development had indicated the Schulman-Plantic deal was completed, and that Plantic would invest almost $5 million and create 15 jobs at the site. Plantic is based in the Melbourne suburb of Altona, Australia.