At NPE2018, PolyOne Corp. is putting its money where its customers are.
"Our overall investment at NPE is doubling, and we're having our Investor Day there as well," Chairman, President and CEO Robert Patterson said in a recent interview at the firm's headquarters in Avon Lake, Ohio.
"Interacting with customers is the best reason to be at NPE," he added. "We're investing to drive growth in sales, marketing and technology. That could be the difference maker in results for this year and beyond."
PolyOne, North America's largest compounder and concentrates maker and one of the region's largest resin distributors, is launching or expanding several product lines at the show. Those efforts include:
• OnFlex-brand LO thermoplastic elastomers, a portfolio of low VOC/FOG and odor polymer grades that assist OEMs in meeting vehicle interior air quality standards in HVAC dampers, fasteners and clips, coin trays, center consoles, door pockets and other interior parts.
• Resilience-brand LS PVC materials for LED lenses. The materials are durable in extreme outdoor environments and highly resistant to corrosion and chemicals.
• Comptek-brand high-temperature formulations. High-heat products based on extreme-heat polymeric materials such as PEEK, PPS and PSU. Properties that can be achieved with these materials include transparency, electrical and/or thermal conductivity, laser marking and X-ray opacity.
• Lactra-brand SX UV barrier additive. In solid masterbatch form, this additive provides high-performance light blocking technology and protection for liquid dairy contents when added to monolayer PET bottles.
• FireCon-brand CPE. Based on chlorinated polyethylene, this flame-retardant material resists acids, alkalis, oils, fuels, chemical solvents, extreme temperatures and weather.
• OnColor-brand Brilliant concentrates, a new line of special effect masterbatches that meet the need for paint replacement and premium surface finish.
• Hammerhead Marine Panels, which are continuous-fiber-reinforced thermoplastic sandwich panels that offer boat manufacturers a lighter, more efficient alternative to traditional marine construction materials.
PolyOne is also focused on sustainability, according to Patterson, and on what it calls "the four P's" of people, product, planet and performance. He addressed these topics in the firm's most recent letter to shareholders in its 2017 annual report.
"We look at sustainability as it relates to our products," Patterson said. "We want to better articulate what sustainability is and what it means for our future."
Sustainability efforts for PolyOne in 2017 included 26 energy-saving projects worldwide that reduced the firm's energy usage by 10 percent and 47 waste-minimizing projects that reduced waste generated by 11 percent.
At PolyOne's plant in Assesse, Belgium, a solar energy roof is saving 90 tons of carbon dioxide per year. Solar panels and wind turbines at that site could generate a majority of the plant's electricity. PolyOne also has replaced metal halide light fixtures with LEDs at its Gordon Composites plant in Montrose, Colo., resulting in 16 percent energy savings.
"Plastics are still advantaged vs. other materials, and our customers are asking us how to make their products better," Patterson said. "We're seeing people taking more of a role to increase awareness of recyclability and recycling."
In 2017, PolyOne saw sales climb almost 10 percent to just over $3.2 billion, as profit from continuing operations grew more than 4 percent to almost $174 million. The firm also had its eighth consecutive year of record levels of adjusted earnings per share in 2017.
PolyOne has increased its sales, marketing and R&D resources by nearly 20 percent in the last three years. Also since 2014, the firm has decreased the size of its average sales territory by 4 percent while adding sales personnel. This change has resulted in a 20 percent increase in sales calls per seller and a 40 percent increase in sales calls made overall.
"In sales, we've become a specialty company," Patterson said. "We want to improve our sales mix and drive sales growth and margin expansion."
Before decreasing the size of its sales territories, PolyOne "didn't have the resources we needed to spend more time with customers," he added. "Now we can do that and prospect for more business."
PolyOne also stayed very active in the acquisitions market, making four during 2017. The firm now has made eight acquisitions in less than three years. PolyOne spent almost $164 million on its four 2017 acquisitions.
This year, the firm has purchased Spanish color and additive concentrates maker IQAP Masterbatch Group SL.
"We make acquisitions where we can invest and drive growth," Patterson said. "Smaller bolt-ons lend themselves to what we want to do. We can take what they have and accelerate growth. That's kind of our sweet spot."
Lower corporate tax rates in the U.S. will impact PolyOne by 1-1.5 percent, he added, allowing the firm to repatriate cash that it can use for investment.
Patterson said that a potential tariff fight between the U.S. and China likely wouldn't affect PolyOne directly.
"What we sell in China, we make in China," he explained. "The impact for us would be more based on how tariffs impact the economy overall and how they affect our customers."
Patterson, 45, joined PolyOne in 2008 as the firm's chief financial officer. He previously held management posts with Novelis Inc. and SPX Corp.
In 2014, Patterson became PolyOne's president and CEO. He added the additional title of chairman in 2016.
