A&W steps up the pace in the Asia-Pacific

01 May 1996 00:00  [Source: APC]

A major supplier of surfactants, increasingly active in the Asia-Pacific, is Albright & Wilson, the UK-based chemicals firm spun off from US oil company Tenneco last year, writes Alan Tyler.

It has recorded a 9.6% increase in sales on the back of an improvement in its surfactants business and a strong performance in speciality chemicals for 1995. A&W competes in the speciality chemicals, phosphates and surfactant markets, and saw pre-tax profits increase 24% during the period.

A&W's chief executive Robin Paul said the worst of the raw material prices that had affected speciality companies for the past two years were over, although the company spent an extra £43m (US$64.5m) on raw materials last year, a 10% rise on the previous year. Turnover in the surfactants business in 1995 was 13% ahead of the previous year, but raw material price increases and intense competitive activity held back operating profits. Substantial progress was achieved on a number of fronts in this business, which provided encouragement for the future, he said.

The response to market conditions has been to concentrate on higher margin products, to exit peripheral activities, and reduce costs.

In Spain, where market conditions were significantly worse than expected, the detergent powder plant at Sanchidrian was closed, and rationalisation steps were implemented at the sites at Barcelona and Alcover.

Elsewhere, the packed powder business, based at Whitehaven in the UK, and the distribution business carried on by Surphos Chemicals in the Netherlands, were sold. The liquid bottling operation at Castiglione, Italy, was transferred to a jv.

The year was not entirely a time of rationalisation. The surfactant jv at Changsha in China completed its first full year. The Changsha project is Albright & Wilson's first manufacturing investment in China and its first in the country's multi-million dollar toiletries and detergent market.

The 50:50 jv with Hunan Resun Industrial General Corp manufactures surfactants for laundry detergents, toothpastes and shampoos. The company also has other ventures in Thailand, Malaysia, Singapore, Indonesia and the Philippines for speciality chemicals and phosphates.

A&W's surfactants business is focusing more of its resources into higher value added areas which include the manufacture of heavy duty liquids, amines and derivatives and products for the personal care and industrial surfactants markets.

Demand across the world for A&W's range of phosphate products was sustained at a high level, according to Paul. A substantial increase in the volume came from the new Mexican joint venture, and all three purified phosphoric acid plants, in the UK, US and Mexico, achieved record output.

Overall the phosphates business produced operating profits at 14% above the previous year's level, notwithstanding the very tight position on phosphorous supplies in the Asia-Pacific.

The joint venture in Mexico produced a record quantity of phosphoric acid and a new unit has been commissioned to manufacture sodium tripolyphosphate for laundry detergents.

A&W demonstrated its confidence in the phosphates business by investing heavily.

At Oldbury in the UK new plants for the production of phosphorus oxychloride and polyphosphoric acid have been commissioned and there is to be a major expansion of purified phosphoric acid at Whitehaven.

The £8.5m project will boost the plant's capacity by 30 000 tonne/year and deliver a greater proportion of the higher purity acids. This investment should confirm the plant as the world's largest production unit for purified phosphoric acid.

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