The Coperion compounding extruder business is gaining sales from polyolefins thanks to shale fracking, and Coperion and K-Tron feeders are growing from installations in engineering plastics, Hillenbrand Inc. CEO Joe Raver said in a fourth-quarter conference call.
Hillenbrand owns Coperion, K-Tron and Rotex, which makes screening and material separation equipment, under its Process Equipment Group. That group also includes businesses that make displacement pumps, flow-control valves and large crushing and size reduction machinery.
Hillenbrand, based in Batesville, Ind., is traded on the New York Stock Exchange. For its fiscal year ended Sept. 30, the company generated sales of $1.59 billion, up 3 percent from 2016.
"Demand for plastics projects and screening and separating equipment remained strong throughout the year in the Process Equipment Group," the company said. Sales increased 7 percent for the year at the group. That offset a 2 percent decline from another Hillenbrand business, Batesville Casket Co.
Raver said the machinery businesses have a good backlog going into fiscal 2018.
"We anticipate growth in all of our industrial equipment, as we work through our backlog with good growth in separation and plastics equipment," he said in the Nov. 17 call. Parts and service sales in the plastics equipment division also looks good, he said.
"We have pretty strong order intake and we have backlog in our parts and service business, basically in our plastics business … we're expecting to have solid parts and service growth in 2018."
He said Coperion is picking up orders for compounding extrusion lines, in part thanks to the U.S. shale gas boom.
"Our outlook remains positive for polyolefin systems," Raver said, adding that the growth is happening in Asia, "and the potential for another wave of projects in North America."
Raver also signaled that Hillenbrand is looking for targeted acquisitions.
"Feeders and extruders were driven by engineered plastics as well as food and pharmaceutical applications," Raver said, adding that the latter two areas remain small for Hillenbrand. Because food and pharmaceuticals put a premium on a good brand name, reliability and safety, he told analysts, "this is a great area for us to focus on M&A."
The engineering plastics segment has driven orders of smaller compounding extruders, he said.