CHICAGO Bonnell Aluminum
Inc.s cost-cutting measures during the recession should
benefit the extruder as the economy recovers and opportunities
in the automotive sector rev up, says incoming president W.
Profitability has risen more
quickly than sales volumes over the past two years, Hamilton
said, with the Newnan, Ga.-based company posting 2012 earnings
comparable to those of 2008 even while logging 20 million
pounds less in sales volume.
"This is significant because, as
business continues to improve, our profitability and cash
generation will be even more robust," Hamilton said during the
annual shareholders meeting of parent company Tredegar
Hamilton is succeeding Duncan A.
Crowdis, who will retire June 1 (
amm.com, Feb. 22).
Bonnell will continue to look to
increase its geographic diversity and grow organically,
Hamilton said, citing the companys recent acquisition of
competitor Aacoa Inc. (
amm.com, Oct. 1). That "milestone" move has
increased Bonnells customer base and allowed the company
to participate in new markets, he said.
Hamilton called Aacoa "one of
the very best anodizing suppliers" in the United States and a
"world-class extrusion operation" with strong expertise in
value-added fabrication. Other synergies between Bonnell and
Aacoa include a consolidation of scrap and billet supplies and
the transfer of business between their respective facilities,
Bonnell also is well positioned
to become a "significant supplier" to the automotive market,
Hamilton said, citing the companys plans to invest $17
million in new equipment and infrastructure (
amm.com, Feb. 12). The new extrusion press and
handling system at Newnan will be capable of supplying 15
million pounds of specialty product to Tier I automotive
original equipment manufacturers annually, he said.
Automotive shipment growth rates
have been "solidly" in the double digits in recent years and
were up approximately 18 percent last year compared with 2011,
Hamilton said. Such growth rates "far exceed" those in the
building and construction and consumer segments and "outshine"
declines seen in some other markets, he added.
Aluminum requirements in the
automotive sector should grow thanks to regulations that will
require better gas mileage, encouraging the lightweighting of
vehicles, Hamilton said. "We are entering the market at the
beginning of a strong phase of growth."
Tredegar chief financial officer
Kevin OLeary said Bonnell has seen better results thanks
in part to better pricing on value-added products and services
and due to cost-cutting measures, such as the closure in August
of a facility in Kentland, Ind., that was focused on the
residential construction market (
amm.com, Feb. 2, 2012).
"Bonnell continues to set the
standard in Tredegar for operation excellence," Tredegar chief
executive officer Nancy Taylor said.