Nalco Holdings Co. (NLC) said it will implement price increases
for its water and process services division, as the water-treatment
company said it is being squeezed by higher energy and raw material
costs.
The company also noted tighter availability of some raw
materials, as well as rising freight and personnel costs, to
justify the higher prices.
Price increases, which will vary by country and industry, are
effective immediately or as contracts permit, Nalco said. They will
rise between 7% and 15%, depending on product mix.
David Flitman, president of the water and process services
division, said the increases will allow the company to invest in
research and development and manufacturing process improvements.
Nalco's sales team will contact customers to discuss the impact of
the increases.
Nalco's water and process services division includes two main
segments--paper services, which serves the pulp and paper
industries, an water services, which focuses on customers across
various industrial and institutional markets.
The company, which sells the Corexit 9500 dispersant product
that was used by BP PLC (BP, BP.LN) to combat the Gulf of Mexico
oil spill, is more broadly expected to benefit from economic
improvements over the next few years, which will boost industrial
demand for water, as well as lift energy costs, further stressing
water-scarce regions.
In October, Nalco reported its third-quarter profit more than
doubled as revenue rose across all regions, led by a jump in key
markets where the company has been investing heavily.
Shares were up a penny to $29.90 in after-hours trading.
-By John Kell, Dow Jones Newswires; 212-416-2480;
john.kell@dowjones.com