Xerium Announces New Business in China
July 22 2015 - 4:15PM
Business Wire
Two Plants, New Headquarters, New Supply
Chain, $60 million Investment
Xerium Technologies, Inc. (NYSE:XRM), a leading global provider
of industrial consumable products and services, has announced that
it has materially completed the $60 million successful
restructuring of its business in China. The business is now in a
position to locally serve customers in China, Asia, and also export
certain products globally. The make-over of its China and Asian
business has taken over 3 years to complete with a number of key
aspects required for full implementation. Xerium has implemented an
all-Asian business model and will now run its entire Asian business
from Shanghai. Highlights of the repositioning of Xerium’s Asia
business are as follows:
This Smart News Release features multimedia.
View the full release here:
http://www.businesswire.com/news/home/20150722006289/en/
Kunshan, China Press Felt Plant (Photo:
Business Wire)
- Production has
begun at Kunshan, China Press Felt Plant – Xerium
completed a 2 year, multi-million dollar construction project to
build and equip a brand-new press felt plant in Kunshan, China.
This greenfield plant is located in the heart of the Yangtze River
paper-making region, which is at the center of the largest
paper-making region in the world - China. It took over 2 years to
design, build, equip, and commission. Until this new plant began
production, Xerium served this region mainly as an exporter of
products made in Europe. Xerium has significantly increased its
competitive position with this plant and will now be able to more
closely partner with customers in China and the rest of the
world.For the first time ever, customers in China will receive
locally provided and optimized state-of-the-art press felt
solutions from Xerium. Xerium will conduct business in local
currency and local languages. The Kunshan plant will be able to
service the largest pulp, paper, paperboard, and tissue machines in
the world, as the main machine in the plant is greater than 15
meters wide. This central machine and its foundation weighed almost
1 million pounds at installation, and is one of the largest of its
type in the world. For some press felt designs, the company will be
able to make 3 pieces simultaneously - a first for the company. The
plant has state-of-the-art information systems and supply chain
interfaces along with real time operational communication systems
throughout the site. It is conducting business from a new Infor™
information technology platform. The company is moving a large
portion of its press felt production to this plant in China. The
plant has initiated production.
- Renovated
Changzhou, China Rolls Plant – Xerium completed a 2
year, multi-million dollar investment program to completely
renovate its rolls and mechanical service plant in Changzhou,
China. This plant is located in the Yangtze River paper-making
region. Until this renovation was completed, Xerium had served this
region for many decades by exporting high-end working rolls from
Europe. Xerium has now transferred all of its technology to this
plant – SMART® Roll production cell, spreader roll production cell,
polyurethane production cell, suction box production cell, upgraded
extrusion and drilling equipment. The plant can now produce all of
Xerium’s designs. The plant recently received ISO-9000 quality
certification.
- Implemented
new Asia Headquarters in Shanghai - Moved and
reincorporated Xerium Asia headquarters into the Shanghai Free
Trade Zone. This special Chinese government approval allows Xerium
to import/export at the lowest possible cost, expedite customs
processing, provide shorter lead times for materials transfer,
enables maximum leverage of working capital for Xerium across Asia,
and receive improved tax treatment as a local Chinese business
entity. The entity is now in place.
- Implemented
new Chinese Capital Structure – Implemented a local
capital structure and banking relationship by moving a portion of
the Xerium corporate debt structure to China. The company has
implemented a multi-million RMB on-going loan in China with ICBC,
the largest bank in the world. Xerium will now conduct local
business in local currency (RMB), finance and fund its China
business locally in RMB. This will also enable Xerium to both
secure a natural business hedge and receive local entity tax
treatment. The new loan and new ICBC financial relationship are
complete and in place.
- Localized all
Asian Leadership - Moved its Asia business leadership
from the United States and Europe to China. The key top personnel
moves were: moved President and CFO positions from the US to
Shanghai, moved Sales leadership from Europe and Australia to
Shanghai, moved technical leadership from Europe to Shanghai. All
of these personnel moves are complete.
- Implemented
Chinese IT structure - Moved its IT and data support
from Europe to Shanghai. The company has completed its data center
in Shanghai and is partnered with SAP as its provider for rolls
plant information technology, and is partnered with Infor™ for
machine clothing plant information technology. Both technology
providers have huge businesses in China and are also located in
Shanghai.
- Implemented
Contemporary Asian Supply Chain - Moved its Asia supply
chain and warehousing activities from in-house/locally provided
into a global partnership with Panalpina. Panalpina is one of the
world’s leading providers of end-to-end supply chain solutions.
Xerium is connecting its internal systems with Panalpina to give
its customers a seamless electronic supply chain. The supply chain
moves are in place.
Mr. Harold Bevis, President and CEO of Xerium, made several
comments regarding this business realignment. “Competing and
winning in China and throughout Asia is central to Xerium’s
corporate repositioning. Xerium’s legacy markets in North American
and European newsprint, printing and writing are all under
pressure. These market segments are going through permanent
correction. Several years ago, the Board of Xerium decided to
tackle this situation head-on and reposition its assets and
commercial profile directly into growth markets globally.
“These China investments have taken a few years and a lot of
money to implement. We are very happy that these new investments
are coming on line now. The commercial objective is to provide
machine optimization solutions with world-class technology and
shorter lead times, at a local cost structure. Customers will
immediately benefit from improved costs, better lead times, better
technology, and better service. This new business start-up is a key
part of Xerium’s investment strategy to realign its global business
model and global factory locations to line up with growth markets
in the world.
This business restructuring is an important part of the business
strategy being deployed at Xerium – to reposition the company into
growth markets. We are excited about our new future in Asia. This
restructured business is now underway producing and selling machine
clothing, performing on-machine service, and performing in-factory
rolls and mechanical service.” added Mr. Bevis.
ABOUT XERIUM
Xerium Technologies, Inc. (NYSE:XRM) is a leading global
provider of industrial consumable products and
services. Xerium, which operates around the world under a
variety of brand names, utilizes a broad portfolio of patented and
proprietary technologies to provide customers with tailored
solutions and products integral to production, all designed to
optimize performance and reduce operational costs. With 27
manufacturing facilities in 13 countries around the
world, Xerium has approximately 3,100 employees.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements. The
words “believe,” “estimate,” “expect,” “intend,” “anticipate,”
“goals,” variations of such words, and similar expressions identify
forward-looking statements, but their absence does not mean that
the statement is not forward-looking. Actual results may differ
materially from these forward-looking statements and estimates as a
result of various important factors, including, without limitation,
the factors discussed in our annual report on Form 10-K for the
fiscal year ended December 31, 2014, which is on file with the
SEC and is available in the investor relations section of our
website at www.xerium.com. Any forward-looking statements are as of
the date hereof, and we assume no obligation to publicly update or
revise these forward-looking statements for any reason, whether as
a result of new information, future events, or otherwise, except as
may be required by law.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20150722006289/en/
Xerium Technologies, Inc.Cliff Pietrafitta,
919-526-1444Executive Vice President and Chief Financial
OfficerIR@xerium.comorICR Inc.Dan Whalen, 203-682-8277Senior Vice
President
Xerium (NYSE:XRM)
Historical Stock Chart
From Aug 2024 to Sep 2024
Xerium (NYSE:XRM)
Historical Stock Chart
From Sep 2023 to Sep 2024