CARTRIDGE FILTER MARKET UPDATE
NOVEMBER 2011
McIlvaine Company
TABLE OF CONTENTS
Pentair Reports Solid Third Quarter 2011 Results
Ahlstrom Reports Demand Decline Impacted 3rd Q Performance
Buckeye Reports Strong Q1, Plans FL Expansion
PGI Unveils New Platform Technology to Produce Nonwovens with Submicron Fibers
Superior Felt & Filtration Expands Ingleside, Ill Operations
Hollingsworth & Vose Opens Warehouse in India
Pall New Technology Bound for WPI Biomanufacturing Education/Training Center
Cummins Divests Light Duty Filtration Business
Entegris Inaugurates Filtration Facility in Taiwan
Pentair Water Purifier for Residential Use
3M Introduces Advanced Bio Filters
Many projects are detailed in monthly updates under Industry Analysis in this Report’s Chapters. Click on the links below to view information on these projects.
Filtration 2011 International Conference and Exposition, recently held at Chicago’s Navy Pier, featured more than 120 exhibitors from all links in the global filter supply chain. Product introductions include:
Hollingsworth & Vose presented two new filtration media products — NanoWave HVAC Pocket Media and Inviscint Hydraulic Filter Media.
NanoWave is a synthetic alternative to glass mat media that offers increased sustainability and high discharge efficiency. Produced with a single-polymer, the media’s stiff design results in enhanced processability and creates rigid pockets for filters. With low pressure drop and high dust-holding capacity, the media fits a broad range of HVAC applications. Charged NanoWave is also offered, which provides increased submicron particle retention, as well as higher MERV classifications.
The new Inviscint Hydraulic Filter Media combines peak performance with incredibly low pressure drop. New Inviscint media reduces fluid flow restriction by up to 50%.It cuts overall system energy requirements while delivering increased reliability, less maintenance, and longer life for filters and hydraulic systems. Inviscint is designed as the next-generation media for construction, agriculture, and industrial equipment. End users looking for optimal energy savings and system performance should consider Inviscint filter media.
Ahlstrom’s recent efforts in its filtration business include new capacity in its gas turbine and high efficiency air business in Tampere, Finland as well as new capacity for transportation filtration applications in Brazil. With roots in the transportation market, Ahlstrom has made several investments and acquisitions to expand its role in the filter media market. Its most recent acquisition was Shandong Puri Filter & Paper Products Ltd., a Chinese producer of transportation filtration media.
Ahlstrom recently launched a renewed brand identity that is the visual expression of the company’s new business strategy developed in response to the changing needs of its customers. A new logo and brand promise, Stay Ahead, reflect the company’s commitment to renewal and delivering results.
Nonwovens manufacturer Kem-Wove launched new line of advanced no drip, no melt flame retardant products. These products have excellent FR properties and are able to withstand temperatures up to 500°F. Pending official test results (in process now) materials should pass both horizontal and vertical burn. Materials have great insulation properties and can be supplied either bare or laminated to various lining fabrics. Applications can be found in filtration, apparel, furniture, industrial and building markets, protective gear, portable structures, sleeping bags, fire fighters products, tents, possible electric spark absorber, vehicle protection, tarps and others.
FibeRio Technology Corporation launched its new 1.1 meter wide continuous nanofibre production system, Cyclone Fiber Engine 1.1. The company states it is the first full scale production model utilizing Forcespinning technology, which offers both melt and solution spinning capabilities, increased productivity and a significant reduction in production costs.
The system has been designed to be integrated into a nonwoven production line further enhancing its productivity gains, or it can be delivered as a discreet roll-to-roll system for specialty products or limited runs (Fiber System configurations).
Webex featured examples of custom machinery used in converting and producing filtration material. Examples displayed included custom converting modules and complete converting lines, along with Webex’s versatile line of REM slitter rewinders.
Milliken & Company demonstrated a number of products with applications for the filtration industry, including a variety of high loft products using a broad range of fibers, fiber distributions and orientations. Needle felts used for high temperature filtration media including traditional PPS felts as well as pleatable, topically and chemically treated fabrics for high temperature cartridges are being featured. Milliken also used the show to introduce Eminus nanofiber products for high efficiency filtration withpatented high volume webs with controlled fiber size distribution, engineered depth and filtration properties.
Jentschmann introduced its ultrasonic welding machine, Weldsonic Filter, for closing pleated filter packs. This machine operates with a continuous welding process and bonds the first and last filter pleat directly together. For non-weldable materials, such as cellulose, the machine uses hot melt adhesive tapes to ensure a strong bond.
Innovative Resin Systems, a custom formulator and manufacturer of one and two component epoxies, two component polyurethane and radiation cure adhesives for chemical, industrial, reverse osmosis and air filter applications, debuted its Acrylic-Cure AC 8810.
Textest AG of Switzerland introduced its FX 3300 Air Permeability Tester LABAIR IV, the latest addition to the complete family of Air Permeability Testers.
Meltog launched two key machines in the U.S. during Filtration 2011. The UK-based specialist manufacturer of both spiral and linear lock seam filter tube machines and seaming and coil handling equipment will be unveiling its STM125 and STM350 spiral tube machines.
Nordson featured its family of foam technology equipment including the SureFoam dispense systems that combine hot melt adhesives or sealants with inert gas to create a closed-cell foam. Gas content can be up to 50% by volume, so up to 50% reduction in adhesive consumption.
Franklin Adhesives & Polymers’ FilterFAB line launches three adhesives that meet many bonding applications in the assembly of air and liquid filters. The line includes two water-based Polyvinyl Acetate (PVA) adhesives for assembly and a polyurethane filtration adhesive that can handle end cap potting and edge/frame sealing.
Quantachrome Instruments showcased its Porometer 3G capillary flow porometer, the latest generation through-pore size analyzer in a line of instruments that can trace its origins to the popular Coulter porometer.
Filtration Technology Systems focused on the latest addition to its extensive line of filter production equipment. The CC-1-ATCF is a pleat assembly line with auto feed and auto load compression chamber and it has a much smaller footprint than any other pleat assembly line.
P2i demonstrated the benefits of its nano-coating technology for the filtration sector. The technology, which was originally designed to make soldiers’ protective clothing more effective against chemical attack while maintaining levels of comfort and breathability, is now applied to five key filtration applications: Aviation Fuel, Diesel Fuel, Gas Turbines, Industrial Compressors and Hard Disk Drives.
Pentair, Inc. (NYSE: PNR) announced third quarter 2011 sales of $891 million, an increase of 15 percent from the same quarter last year. These results reflected growth across both segments, Water and Technical Products, including 11 percentage points from the acquisition of Norit's Clean Process Technologies (CPT) and 2 percentage points from favorable foreign currency. Third quarter 2011 results included restructuring charges of $2 million related to repositioning actions in its Water business.
"We had another solid quarter with balanced top-line growth and good margin performance across our businesses," said Randall J. Hogan, Pentair chairman and chief executive officer. "Growth investments continued to yield positive results with fast growth regions up 22 percent in the quarter, before including the CPT acquisition. Innovation, expanded distribution and improved operating performance helped to drive solid global demand across our end markets. The CPT results reflected strong double digit sales growth from a year ago, demonstrating the strength of its membrane technology and systems expertise in water and beverage solutions."
"Solid price realization of 2 percent in the quarter combined with productivity more than offset inflation. The year-over-year margin decline reflected the negative impact of the CPT acquisition and related intangible amortization and acquisition related costs, as we anticipated. We expect to drive sequential CPT margin improvement through a combination of volume leverage, lean-driven efficiencies, as well as repositioning efforts that are already underway," added Hogan.
The company reported third quarter operating income of $93 million compared to $91 million in the prior year quarter. Adjusting to exclude acquisition related costs and restructuring charges, operating income increased 11 percent to $101 million and the company achieved operating margins of 11.3 percent compared to 11.7 percent of a year ago, reflecting the impact of the CPT acquisition. Pricing combined with productivity gains more than offset inflation across both Water and Technical Products. Third quarter 2011 results included the benefit of a lower effective tax rate, largely resulting from the CPT acquisition and a favorable geographic mix.
Free cash flow was $70 million in the third quarter, resulting in $188 million through the first three quarters of 2011. The company said it expects to achieve free cash flow of approximately $250 million for the full year 2011.
Third Quarter Business Highlights
Water sales grew 20 percent year-over-year to $615 million, including 17 percentage points from the CPT acquisition and a two-percentage point favorable impact from foreign currency. Year-over-year sales growth was negatively impacted by approximately 6 percentage points due to sales in 2010 related to the Gulf Intracoastal Waterway (GIWW) project. Within the five Water global businesses, the third quarter sales performances were as follows:
· Residential Flow sales were up 15 percent versus the prior year quarter, led by double-digit growth in U.S. residential de-watering products and the agricultural business.
· Residential Filtration sales were up 5 percent, as the benefit from new products and increased penetration in fast growth regions offset softness in the U.S. market.
· Pool sales were up 14 percent driven by strong demand for energy efficient pool products and expanded distribution.
· Engineered Flow sales were down 32 percent due to lower U.S. municipal sales largely related to the prior year benefit from GIWW, while commercial and industrial pumps sales increased year-over-year. The year-over-year impact of GIWW resulted in 28 percentage points of the decline.
· Filtration Solutions sales increased 141 percent year-over-year, reflecting a 133-percentage point or $89 million benefit from the CPT acquisition. The remaining 8 percentage points of growth mainly reflected increased sales in foodservice and desalination.
Water's third quarter reported operating income totaled $60 million. Excluding the acquisition related costs and restructuring charges included in the Water segment, third quarter operating income increased 15 percent to $67 million while operating margins decreased 40 basis points to 11 percent, reflecting the negative 100 basis point impact from the CPT acquisition. Pricing and productivity improvements more than offset the negative impact from inflation and continued growth investments.
Technical Products delivered third quarter 2011 sales of $276 million, an increase of 6 percent versus the prior year quarter, including a three-percentage point favorable impact from foreign currency.
Ahlstrom’s net sales for the 3rd quarter July–September 2011 were EUR 389.7 million, down compared to EUR 413.0 million for the same period last year. The company reported an operating loss of EUR 17.3 million (EUR 14.1 million profit same period last year) and operating profit excluding non-recurring items of EUR 8.0 million (EUR 13.8 million).
Filtration sales volumes for the 3rd quarter were down 6.8% partly due to the divestment of Dust Filtration business and lower demand for transportation filtration materials.
In August Ahlstrom signed an agreement to divest its Home and Personal business area to Suominen Corporation during this period. The total value of the transaction is approximately EUR 170 million.
After the review period, Ahlstrom initiated a profit improvement program to address its underperforming businesses. The program aims to generate an annual profit improvement of approximately EUR 15 million and may affect about 400 employees. As part of the program, initiatives in Karhula, Turin and Osnabrück were announced.
On October 18, 2011 Ahlstrom updated its outlook for this year. Net sales from continuing operations are expected to be EUR 1,565-1,645 million. Operating profit excluding non-recurring items from continued operations is expected to be EUR 46-56 million.
Buckeye Technologies announced first quarter adjusted net income of $29.9 million, which excludes net income of $11.2MM from cellulosic biofuel credits generated in 2009. Adjusted net income rose 118% as compared to the prior year period's $13.7 million, which excluded net income of $51.3 million from cellulosic biofuel credits generated in 2009.
Net sales of $240 million were up 19% versus last year's first quarter sales of $202 million. Sales benefited from higher selling prices and increased cotton linter pulp shipment volume. Aside from significantly higher cotton linter costs, cost inflation for chemicals, transportation and other raw materials was modest with energy prices stable.
Buckeye also announced that its Board of Directors approved funding to increase the high-end specialty wood pulp capacity by 42,000 tons at its Buckeye Florida "Foley" operation. The cost of the project is expected to be approximately $79 million with an anticipated rate of return of 15% to 20%. Engineering and design work is nearing completion, and construction is expected to begin in January 2012 with project startup planned for December 2012. This investment will be funded by cash flow from operations.
Buckeye's chairman and CEO John Crowe, says, "This specialty expansion project will provide much needed high-purity specialty volume for strategic customers in all of our high-end markets including casings, tire cord, ethers, filtration, micro-crystalline cellulose, and acetate. Additionally, this will improve our overall plant product mix from 42% specialty wood pulp to just over 50% specialty wood pulp while maintaining the Foley plant's existing total capacity at 465,000 tons per year. This is the type of high-return organic growth opportunity that we will continue to target as we allocate our free cash flow to its highest and best use. We believe this project will provide excellent value to our customers and our shareholders."
Polymer Group, Inc. (PGI) recently unveiled a new platform technology to produce nonwovens containing submicron fibers that can deliver improved performance properties for healthcare, industrial, filtration and new emerging market applications.
PGI's proprietary Arium™ technology produces a matrix of fibers predominately sized under one micron in diameter.
"Arium is a completely new technology platform for the industry that will enable us to meet the market need for increasingly cost-effective fabrics with improved performance at a value proposition unmatched by any other submicron fiber technology," said Veronica "Ronee" Hagen, PGI's chief executive officer. "Just as we did with our Apex® and Spinlace® technologies, PGI is leading the industry and investing in game-changing platforms."
PGI has improved the process of producing submicron fibers with its new process after significant R&D efforts. "While other processes can generate fibers at the submicron level, none can do it as efficiently, and with the same commercial level of throughputs, as Arium™ technology," said Bob Dale, PGI's senior vice president of research and development.
PGI has invested in a pilot line in the U.S. at its Waynesboro, Va. facility to produce fabrics using the Arium™ technology. The technology can stand alone or be retrofitted to PGI's existing meltblown equipment.
"Our Arium technology™ allows us to be more competitive in our core markets while opening up new opportunities in other markets," said John Heironimus, the company's senior vice president, chief marketing and chief sustainability officer. "By combining technologies, or utilizing Arium™ technology alone, PGI can deliver innovative product solutions to the market."
The submicron fibers contained in materials produced with the Arium™ technology can provide higher surface area, biosafety and tunable porosity that enhance performance benefits such as absorbency, adsorption, opacity, softness, barrier protection, acoustic performance and high-efficiency filtration.
Superior Felt & Filtration, LLC continues to expand its operations in Ingleside, IL. Several new facilities have been opened this summer which have expanded Superior's nonwoven distribution capabilities.
Already stocking the largest inventory of micron, CFM, synthetic and SAE wool felts in North America SFF also distributes and converts Technostat, a sub-micron, high-efficiency filter media to meet the most demanding tribo-electric filtration needs. SFF has also added a new white room which includes converting capabilities to further support its position in slitting, heat die-cutting and other value added services.
Additionally, Superior announced that its manufacturing division, NonWoven Solutions, is installing another needle punch line to double production and strengthen its position in the medical and filtration textile industry. The new line will be operational by year’s end, evidence that Superior Felt continues to position itself as a leader in the felt and filtration market.
Filter media manufacturer Hollingsworth & Vose has set up a warehouse operation in India under the name Hollingsworth & Vose Trading Company (India) Private Limited.
The new warehouse means Hollingsworth & Vose can offer Indian customers one week lead times instead of the more typical 4-6 week lead times for products purchased directly by customers from Hollingsworth & Vose mills outside India.
Hollingsworth & Vose vice president, International, David von Loesecke said: “The new trading company, along with the previously announced joint venture with the Nath Group, is a significant milestone in establishing our physical presence in India and growing our business in the surrounding region.”
A public-private partnership between Pall Corporation (NYSE:PLL), Worcester Polytechnic Institute (WPI), and the Massachusetts Life Sciences Center (MLSC) will provide WPI’s Biomanufacturing Education and Training Center (BETC) with equipment and control systems for use in the processing, separation, and purification of biopharmaceuticals.
Nearly $530,000 worth of bioprocessing equipment known as chromatography liquid handling systems will be built for the BETC by Pall Corporation. The technology will be paid for with the help of a $250,000 grant from the MLSC, which leverages a matching 50-percent price reduction on the new equipment from Pall.
The BETC (www.wpi.edu/+biomanufacturing), which is now under construction at WPI’s Gateway Park in Worcester, Mass., will be a near-commercial-scale biomanufacturing pilot plant, providing hands-on training and educational opportunities for the multilayered workforce needed to produce medicines and research compounds using engineered living cells.
The BETC will be located in a four-story building now under construction at Gateway Park by the O’Connell Development Group of Holyoke, Mass. Occupancy is expected in late 2012. In addition to this new grant to purchase the Pall equipment, construction of the BETC and other life sciences spaces in the new building at Gateway Park is funded in part by a $5.1 million capital grant from the MLSC.
The BETC will have industry-standard process areas of equipment preparation, buffer and media preparation, fermentation and cell culture, product capture, purification, and analytics.
US private equity firm Industrial Opportunity Partners (IOP) has acquired Cummins Inc’s light duty filtration assets. IOP has renamed the business Kuss Filtration Inc.
Headquartered in Findlay, Ohio, Kuss provides light duty automotive and industrial filtration solutions serving approximately 250 customers worldwide in the automotive, industrial equipment, materials handling, lawn and garden, agricultural, and motorcycle industries. The Kuss product range includes in-tank fuel filters, embedded pleated paper filters, specialty automotive filters, specialty industrial filters, and intake and cabin air panel filters.
Hasnain Merchant, formerly general manager of the Findlay, Ohio location, is the new chief executive officer of Kuss.
“Although Kuss was non-core to Cummins due to its primary end markets, the company has developed a strong product portfolio, has talented and dedicated employees, and presents attractive growth opportunities. We look forward to partnering with IOP to focus on continuing to grow the business,” said Merchant.
Cummins will remain a key customer of and supplier to Kuss.
Entegris Inc has opened a new manufacturing and research facility in Hsinchu City, Taiwan to design and produce advanced filtration and materials handling components for the semiconductor industry and other high-tech industries.
The new Entegris facility will also provide lab services to customers in Taiwan and across Asia.
Gideon Argov, president and CEO of Entegris, said: “We believe we will be the first world-class manufacturer of filters designed for the most demanding high technology manufacturing environments to establish a manufacturing presence in Taiwan.”
Paul Yang, Entegris’s regional director for Greater China, said: “Our decision to open this facility reflects our commitment to be close to our customers in Taiwan and around Asia. We can now support these customers with products that are produced locally, as well as jointly develop filtration technology needed for their most advanced manufacturing processes.”
Pentair Inc has launched a hybrid deionisation (Hybrid DI) system using the company’s CrossCharge technology, reportedly the first electronic water purification system suitable for residential applications.
Hybrid DI systems using CrossCharge technology from Pentair have the benefits of a reverse osmosis (RO) system and those of a water softener without requiring salt.
The CrossCharge technology was developed through a partnership with Dutch firm Voltea and licensed exclusively to Pentair in residential and light commercial applications for point-of-entry products. The new technology uses capacitive electrodes to remove hardness and purify water without employing salt. The core of the system is Voltea’s patented ‘stack’ configuration of electrodes combined with ion-selective membranes. The treatment sequence begins with the purification step, where untreated water flows through the cell where ions are drawn through the membranes and absorbed in the charged electrodes, producing high quality treated water. The electrodes automatically regenerate when the system reverses its polarity. This drives the ions out of the electrodes and flushes them from the stack. The polarity is then reset to normal to start purification again.
Pentair’s CrossCharge technology is driven by a micro-controller which uses sensors to monitor and manage all system and water quality parameters in real time. The technology assesses the inlet and treated water quality, controls the power supplied to the stack, and adjusts operating cycles and system flows to continuously optimise performance. The controller includes self-diagnostics and auto clean cycles and features a full-colour touch screen user interface.
“Hybrid DI system […] produces 90% less waste water than a conventional whole house reverse osmosis system,” said Alok Maskara, president of Pentair’s Residential Filtration business. “Since it treats water without salt, there is no net increase in discharged total dissolved solids.”
3M Purification has launched a range of bioburden reduction filters combining the high filtration performance of membrane-type media with enhanced flow characteristics, enabling lower system costs and longer operating lifetimes.
The new LifeASSURE PNA Filter Series from 3M’s Purification division can be used as pre-filters or final filters, where a high level of microbiological control is required. They are designed specifically for biotech, pharmaceutical and biological applications, such as production of vaccines, laboratory fluids, blood products, fine or bulk chemicals, and purified water.
“The advanced technologies we have engineered into the new LifeASSURE PNA Filter Series will enable customers in the bioprocess, pharmaceutical and other sectors to reduce capital costs and operating overheads whilst simultaneously benefiting from improved microbiological control,” said Andrew Whitehouse, Sales and Marketing Manager for 3M‘s Purification division.
LifeASSURE PNA filter assemblies are available with either a 0.2µm or 0.45µm filtration rating and feature an asymmetric membrane with 3M’s Advanced Pleat Technology (APT) that maximizes the useful surface area of the filter. In addition, optimized filter-media support layers are positioned upstream and downstream of the membrane. Together, these innovations increase flow rate per unit pressure, allowing designers to meet performance targets using fewer cartridges thereby enabling smaller, lower-cost systems. In continuous operation mode the filters achieve longer service lifetimes, saving the costs associated with frequent filter changes. In batch process applications, the higher flow rate can help reduce the number of filters needed to process a given batch volume.
McIlvaine Company
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