Quaker Houghton Acquires Operating Divisions of Norman Hay plc
Quaker Houghton (NYSE: KWR) has closed its previously announced acquisition of the operating divisions of Norman Hay plc, a private UK company that provides specialty chemicals, operating equipment, and services to industrial end markets, for a purchase price of 80 million GBP (~$98 million at today’s rates), subject to post-closing adjustments. Prior to close, Quaker Houghton received German regulatory approval as required.
The Company continues to expect the acquired divisions to have 2019 revenues of ~63 million GBP (~$77 million at today’s rates) and adjusted EBITDA of ~11.3 million GBP (~$13.9 million at today’s rates). The purchase price represents a multiple of ~7.1x of the divisions’ projected 2019 adjusted EBITDA.
Michael F. Barry, Chairman, Chief Executive Officer and President of Quaker Houghton, said, “We are very excited to close the acquisition of the operating divisions of Norman Hay plc and believe that this acquisition adds new technologies with good growth characteristics in attractive core market segments with high barriers to entry such as die casting, automotive OEM and aerospace. We also believe it provides a strategic opportunity to take advantage of external market trends such as the light-weighting of vehicles and 3D printing where we have the opportunity to leverage our global footprint and complementary geographic strengths. In addition, Norman Hay’s engineering expertise, which includes robotics applications, strengthens the existing equipment solutions platform inside Quaker Houghton and further positions the company for Industry 4.0.”
Norman Hay plc was established in 1946 as a decorative electroplating business and has evolved into a global specialty chemicals sealant, surface coatings and engineering group. The company is headquartered at its modern, state of the art production facility in Coventry, England. The company has approximately 400 employees with production and R&D facilities across Europe and the United States. For additional information regarding the Norman Hay operating divisions, please visit:
- Ultraseal (https://www.ultraseal-impregnation.com)
- SIFCO ASC (https://www.sifcoasc.com)
- Surface Technology (http://www.surfacetechnology.co.uk)
- Norman Hay Engineering (http://www.nhe.uk.com)
Non-GAAP Measures The information included in this public release references certain non-GAAP (unaudited) financial measures. The Company presents EBITDA, which is calculated as net income attributable to the Company before depreciation and amortization, interest expense, net, and taxes on income before equity in net income of associated companies. The Company also presents adjusted EBITDA, which is calculated as EBITDA plus or minus certain items that are not indicative of future operating performance or not considered core to the Company’s operations. The non-GAAP figures of Norman Hay plc’s adjusted EBITDA referenced in this release were calculated in accordance with the Company’s methodologies. The Company believes the non-GAAP financial measures provide meaningful supplemental information as they enhances a reader’s understanding of the financial performance of the Company and the acquisition, are more indicative of future operating performance of the Company, and facilitate a better comparison among fiscal periods, as the non-GAAP financial measures exclude items that are not indicative of future operating performance or not considered core to the Company’s or the acquisition’s operations. Non-GAAP results are presented for supplemental informational purposes only and should not be considered a substitute for the financial information presented in accordance with GAAP.
Forward-Looking Statements This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements can be identified by the fact that they do not relate strictly to historical or current facts. We have based these forward-looking statements on our current expectations about future events. These forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, intentions, financial condition, results of operations, future performance, and business, including but not limited to statements relating to the contemplated acquisition described above, our current and future results and plans, and statements that include the words “may,” “could,” “should,” “would,” “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan” or similar expressions. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected in such statements. A major risk is that demand for the Company’s products and services is largely derived from the demand for its customers’ products, which subjects the Company to uncertainties related to downturns in a customer’s business and unanticipated customer production shutdowns. Other major risks and uncertainties include, but are not limited to, significant increases in raw material costs, customer financial stability, worldwide economic and political conditions, foreign currency fluctuations, significant changes in applicable tax rates and regulations, future terrorist attacks and other acts of violence. Furthermore, the Company is subject to the same business cycles as those experienced by steel, automobile, aircraft, appliance, and durable goods manufacturers. Our forward-looking statements are subject to risks, uncertainties and assumptions about the Company and its operations that are subject to change based on various important factors, some of which are beyond our control. These risks, uncertainties, and possible inaccurate assumptions relevant to the Company’s business could cause its actual results to differ materially from expected and historical results. Other factors, including those related to the acquisition described above, could also adversely affect us including, but not limited to:
- potential adverse effects on the Company’s business, properties or operations caused by the implementation of the acquisition;
- the company’s ability to promptly, efficiently and effectively integrate the acquired business’ operations with those of the Company;
- risks related to disruption of management time from ongoing business operations due to the acquisition; and
- the outcome of any legal proceedings that may be instituted against the companies following announcement of the acquisition and transactions contemplated in the related purchase agreement.
Therefore, we caution you not to place undue reliance on our forward-looking statements. For more information regarding these risks and uncertainties as well as certain additional risks that we face, you should refer to the Risk Factors detailed in Item 1A of our Form 10-K for the year ended December 31, 2018, as amended, and in our quarterly and other reports filed from time to time with the SEC. We do not intend to, and we disclaim any duty or obligation to, update or revise any forward-looking statements to reflect new information or future events or for any other reason. This discussion is provided as permitted by the Private Securities Litigation Reform Act of 1995.
About Quaker Houghton Quaker Houghton (NYSE: KWR) is the global leader in industrial process fluids. With a robust presence around the world, including operations in over 25 countries, our customers include thousands of the world’s most advanced and specialized steel, aluminum, automotive, aerospace, offshore, can, mining, and metalworking companies. Our high-performing, innovative and sustainable solutions are backed by best-in-class technology, deep process knowledge and customized services. With 4,000 employees, including chemists, engineers and industry experts, we partner with our customers to improve their operations so they can run even more efficiently, even more effectively, whatever comes next. Quaker Houghton is headquartered in Conshohocken, Pennsylvania, located near Philadelphia in the United States. Quaker Houghton will host an Investor Day on Wednesday, December 11, 2019 in New York City at the New York Stock Exchange. Visit quakerhoughton.com to learn more.
Quaker Houghton to Strengthen Portfolio and Capabilities with Acquisition of Norman Hay plc
Quaker Houghton (NYSE: KWR) has announced it has agreed to acquire the operating divisions of Norman Hay plc, a private UK company with a strong global presence that provides speciality chemicals, operating equipment, and services to industrial end markets.
Norman Hay plc serves a number of parallel as well as complimentary industries including aerospace, automotive, oil and gas and power generation through four divisions:
- Ultraseal – a leading global provider of impregnation technology, including porosity sealants, and associated chemistry and equipment for die cast components;
- SIFCO ASC – a leading global provider of surface treatment solutions through selective electroplating, anodizing, chemical solutions and engineering solutions;
- Surface Technology – a speciality provider of surface treatment solutions including coatings, thermal sprays, plating and other ancillary services; and
- Norman Hay Engineering – a leading provider of design and engineering services that support surface treatment plants and equipment for the Ultraseal, SIFCO ASC and Surface Technology businesses as well as additional third party industrial engineering applications.
Quaker Houghton focuses on delivering value-added service to their customers, something which the Norman Hay engineering design and manufacturing capability will further strengthen by providing expertise and solutions which will improve customer’s production efficiency and reduce costs. Norman Hay will also add impregnation chemicals and equipment, special coating and metal finishing businesses and process engineering capabilities to Quaker Houghton’s comprehensive global product portfolio. With the current trends toward light-weighting and portability, this acquisition will position Quaker Houghton for the future. This acquisition is expected to close in October 2019.
Michael F. Barry, Chairman, Chief Executive Officer and President of Quaker Houghton, said, “This acquisition represents an opportunity to add new technologies with good growth characteristics in attractive core market segments with high barriers to entry such as die casting, automotive OEM and aerospace. We also believe it provides a strategic opportunity to take advantage of external market trends such as the light-weighting of vehicles and 3D printing where we have the opportunity to leverage our global footprint and complementary geographic strengths. In addition, Norman Hay’s engineering expertise, which includes robotics applications, strengthens the existing equipment solutions platform inside Quaker Houghton and further positions the Company for Industry 4.0.”
Norman Hay plc was established in 1946 as a decorative electroplating business and has evolved into a global speciality chemicals sealant, surface coatings and engineering group. The company is headquartered at its modern, state of the art production facility in Coventry, England. The company has approximately 400 employees with production and R&D facilities across Europe and the United States.
About Quaker Houghton:
Quaker Houghton (NYSE: KWR) is the global leader in industrial process fluids. With a robust presence around the world, including operations in over 25 countries, our customers include thousands of the world’s most advanced and specialized steel, aluminum, automotive, aerospace, offshore, can, mining, and metalworking companies. Our high-performing, innovative and sustainable solutions are backed by best-in-class technology, deep process knowledge and customized services. With 4,000 employees, including chemists, engineers and industry experts, we partner with our customers to improve their operations so they can run even more efficiently, even more effectively, whatever comes next. Quaker Houghton is headquartered in Conshohocken, Pennsylvania, located near Philadelphia in the United States. Visit quakerhoughton.com to learn more.
Reaching new heights with automated selective plating equipment
In aerospace manufacturing, the performance and reliability of components is paramount to delivering safe journeys, even in the face of extreme friction and temperature. But the challenges don’t end there. Environmental regulations and increased competitiveness within the industry mean that manufacturers must find efficiencies in all areas, making innovation and collaboration more crucial than ever. That’s why, when the time came for a world-leading aerospace manufacturer to review their surface finishing process, they turned to the market leader in selective plating to find an innovative solution.
Aerospace is an industry like no other, particularly with regard to surface finishing. Renowned – and rightfully so – for its robust standards around the manufacture, repair and maintenance of aircraft components, the industry places great demands on manufacturers. The performance of components mustn’t be compromised in the face of friction, extreme temperatures and corrosive environments, all of which they are exposed to daily. Alongside performance, the manufacturing process itself must adhere to stringent health and safety requirements.
In recent decades, this market-leading aerospace manufacturer has seen their surface finishing processes evolve as they’ve strived to achieve greater component performance for their customers – from brush plating in the 1980s to in-house tank plating thereafter. Now, as industry demands have become even greater and components are required to operate in ever-more challenging environments, a new approach was needed.
Automating the process
Automated processes are now the standard in many manufacturing facilities. SIFCO ASC’s collaborative approach to automating the selective plating process enables users to realize ergonomic, financial and manufacturing performance-related benefits.
This manufacturer required nickel plating on their internal and external diameters for a prebraze application. Automating the selective plating process provided the main benefits this manufacturer was looking for: decreased ergonomic risk, traceability and repeatability of the process, and increased quality outcomes.
As standard, selective plating uses a low volume of chemicals, reducing both the environmental and cost concerns associated with tank plating methods which can result in excessive material and environmental costs and waste. Additional, the custom design of the machine provided unique features and allowed the manufacturer to realize even further benefits in approximately half of the footprint once held by their tank plating line. By using a Fanuc robot with built-in tool changers and tooling storage, the automated selective plating process provides complete flexibility. RFID tags significantly reduce the potential for human error by ensuring tooling is plating the correct part, tracking chemical usage and wrap wear, and facilitating the process to handle a variety of products while ensuring consistent quality. What’s more, the manufacturer was also able to completely remove their scrubber system from service. By using portable filter exhausts, they are more energy efficient and have lower operating costs.
Now fully operational, the automated selective plating machine provides SIFCO ASC’s customer with a highly reliable and precise process, bringing its onsite component plating process in line with their reputation as a leading manufacturer in the aerospace industry. The results are clear to see: the surface coating is highly uniform; quality is consistently high; chemical usage can be precisely monitored; production is robust and levels of output consistent; and operator safety has been improved.
To discover more about the SIFCO Process®, visit www.sifcoasc.com
SIFCO ASC drives quality, flexibility and safety with new TechnoPlate® power pack
SIFCO ASC, the world leading supplier of selective plating technology and solutions, has pioneered a solution to improve quality, flexibility and safety in the selective plating process.
The new power pack line, TechnoPlate® – which has been developed in collaboration with German-based Plating Electronics (PE) – equips users with the ultimate flexibility when it comes to selective plating. Its lightweight design means the power pack is 30% lighter than previous models, making it highly portable for use on the shop floor or in the field, perfectly complementing the plating process which can be applied in a dedicated workshop or as a truly mobile service. The TechnoPlate® units also offer the functionality to store up to ten application steps, negating the need for the operator to adjust critical settings such as volts, amps or polarity throughout the plating operation.
In addition to the TechnoPlate®’s greatly improved software features, built-in overload protection sees the unit immediately turn off output power if it becomes overloaded, improving protection and safety, while a detachable and adjustable control panel improves flexibility and usability. In practice, this enables the user to position the controller for use up to nine feet away from the unit for greater practicality in tight working spaces.
Derek Vanek, Technical Manager at SIFCO ASC, said: “The TechnoPlate® has been in development for more than two years as our team have worked to create a line of equipment which improves the selective plating process for users. The beauty of our plating process is that it is entirely portable, meaning it can be applied virtually anywhere, requiring only a power pack, plating tools, small volumes of solutions and a trained operator. By making the power pack lighter, easier to use and building in improved functionality, the selective plating process is more flexible than ever and delivers consistent quality every time.”
The TechnoPlate®’s other features include dual input voltage (100-250V single phase), switch mode technology for greater accuracy and efficiency and pole changer, enabling a change of polarity with the touch of a button. A fully digital LED display and adjustable front cover also make for greater practicality and ease of use.
SIFCO ASC’s 15-amp and 60-amp TechnoPlate® units will be available for purchase beginning in July 2019 and further models will be added to the line later in the year. For more information visit: www.sifcoasc.com.
SIFCO ASC Receives Presidents’s “E” Award for Exports
On Thursday, May 23, U.S. Secretary of Commerce Wilbur Ross presented SIFCO Applied Surface Concepts (ASC) with the President’s “E” Award for Exports at a ceremony in Washington, D.C. In total, Secretary Ross honored 48 U.S. companies with the President’s “E” Award, the highest recognition any U.S. entity can receive for making a significant contribution to the expansion of U.S. exports.
SIFCO ASC provides practical, cost-effective selective electroplating solutions to improve part performance and reduce manufacturing costs through corrosion protection, increased wear resistance, increased hardness, improved conductivity, anti-galling and more. SIFCO ASC’s contract services, chemical solutions and equipment have been utilized for over 50 years on both OEM components and on parts requiring refurbishment in various industry sectors including: aerospace, oil and gas, power generation, general industry, and more.
“SIFCO Applied Surface Concepts has demonstrated a sustained commitment to export expansion. The “E” Awards Committee was very impressed with SIFCO Applied Surface Concepts’ more than 50 percent increase of export sales over the past four years. The company’s innovative design of product offerings to meet the needs of export markets was also particularly notable. SIFCO Applied Surface Concepts’ achievements have undoubtedly contributed to national export expansion efforts that support the U.S. economy and create American Jobs.” said Secretary Ross in his congratulatory letter to the company announcing its selection as an award recipient.
“The President’s “E” Award recognizes sustained growth in a company’s entire export sales over a four-year period. In the case of SIFCO ASC, this would include our standard export markets, sales into Canada and Mexico, as well as those from Cleveland in support of our sister locations in the UK, France and Sweden. Therefore, the “E” Award is truly in recognition all SIFCO ASC team members as well as our partners and customers globally. I would like to thank everyone at SIFCO ASC for their efforts in helping us reach this achievement,” noted Todd Romanski, International Market Manager for SIFCO ASC. “We would also like to extend our appreciation to US Commercial Services Cleveland, Ohio office and the Global Target Program at Cleveland State University for the help and support to SIFCO ASC in earning this recognition.”
In 2018, U.S. exports were the highest on record with U.S. services at $821.1 billion and U.S. exports of goods reaching $1.7 trillion, demonstrating how American private enterprise can not only survive, but thrive, in the international market.
American companies are nominated for “E” Awards through the U.S. and Foreign Commercial Service office network, located within the U.S. Department of Commerce’s International Trade Administration. Record years of successive export growth and an applicant’s demonstration of an innovative international marketing plan that led to the increase in exports is a significant factor in selecting the overall winners.
SIFCO ASC deltar på industrimässan i Falun
Vi ställer ut på industrimässan den 26-27 september 2018 på Lugnet i Falun.
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SIFCO ASC Modernizes R&D Lab
World leading supplier of selective plating technology and solutions, SIFCO Applied Surface Concepts (ASC), part of Norman Hay plc, has completed a substantial refurbishment of its research and development lab in Cleveland, Ohio.
Originally built in 1992, this is first major site renovation, designed to give research engineers a spacious, practical and durable facility in which to conduct vital research and development work.
On a typical day, the lab accommodates scientists, engineers, and technicians who work to develop SIFCO ASC’s fundamental knowledge through exploratory research and development, as well developing and implementing new technologies and providing direct support to customers as well as the company’s manufacturing teams.
Danijela Milosevic-Popovich, Research and Development Project Engineer, comments: “Much of what we do in the R&D lab requires creative thinking, experimentation and innovation; all things which are easier, more enjoyable and ultimately more successful in a modern, spacious and well-equipped laboratory.
Chic Allen, SIFCO ASC’s North American General Manager, states “The renovation will boost team morale and productivity will benefit considerably, which means our customers will reap the rewards of this considerable investment.”
Committed to employee wellbeing and maintaining workspaces which reflect its innovative, state-of-the-art products and services, SIFCO ASC identified the need for a complete modernisation within the R&D department, which included durable, easy to clean flooring, new cabinets, equipment and facilities and a new ceiling with improved lighting throughout the lab.
Danijela concludes: “Work has recommenced in the new lab with a number of customer-specific projects which require considerable innovation and creativity from our R&D engineering team. We are also busy characterizing our existing product offering through depletion testing while continuing to build our knowledge base on coatings like matrix composite plating.”
For more information on SIFCO ASC, please visit www.sifcoasc.com
SIFCO ASC Talks Automation and Chrome Alternatives at SUR/FIN 2018
Three seasoned industry experts from SIFCO Applied Surface Concepts (ASC) are sharing their insight on a number of critical industry topics at SUR/FIN 2018 from June 4 – 6, 2018. Subjects covered include alternatives to hard chrome, automation of selective plating, and component restoration for remanufacturing.
The annual conference, this year held at the Huntington Convention Center in Cleveland, allows leading surface technology companies to connect, collaborate and contribute to industry developments. Throughout the event, multiple technical sessions will be held on the topics of automotive, aerospace, technology advancements, sustainability and waste management. SIFCO ASC’s focus will be in Session 7 – Aerospace & Defense: Innovating Performance Advancements and in Session 15 – Plating Efficiency Improvements via Equipment, Automation, Material Advances and Lean.
In Session 7, Danijela Milosevic, R&D Engineer and Project Engineer at SIFCO ASC is delivering a talk titled; “Advancements in Brush Plated Metal Matrix Composites (MMC)”. In her presentation, she will review the developmental research of safer, eco-friendly alternatives to hard chrome plating. Alternatives to chrome in the form of MMC, offer unique and superior characteristics to metal plating solutions including hardness, wear resistance, and oxidation protection at high temperatures. Conference attendees can watch Danijela’s presentation on June 4, from 5:00 – 5:30pm.
The second speaker, Derek Kilgore, Mechanical Design and Project Engineer at SIFCO ASC will talk about meeting productivity demand through automation of selective plating in Session 15. In his presentation, on June 6 from 8:30 – 9:00am, Derek will demonstrate how attendees can achieve consistent quality and process repeatability by incorporating automated selective plating into their process. The presentation will include data, video and imagery of a newly-developed, dual-spindled ID plating machine.
Also, in Session 15, Derek Vanek, Technical Manager at SIFCO ASC will present “Surface Engineering for Sustainable Manufacturing and Remanufacturing” and discuss why surface engineering technologies should be considered in remanufacturing engineering to restore or improve the performance of worn or failed components. During his 30 years at SIFCO ASC, Derek has worked in sales, training, project management, and marketing while publishing work on engineering technologies. Conference attendees can watch Derek’s presentation on June 6 from 12 – 12:30pm.
For over 50 years SIFCO ASC has provided selective electroplating and anodizing services, chemical solutions and equipment, offering automated plating systems that can be easily integrated into any production line. A global leader in the industry, SIFCO ASC hopes to provide a deeper understanding to the challenges that face the industry and innovative ways to overcome them.
For more information visit SIFCO ASC on stand 351 or, to set up a meeting, visit: www.sifcoasc.com/surfin-2018
*The SIFCO Process® is a unique and portable plating method used to enhance, repair and refurbish localized areas on components.
SIFCO ASC deltar på Underhållsmässan
Vi ställer ut på Underhållsmässan den 13-16 mars 2018 på Svenska Mässan i Göteborg.
Snart är det dags för Underhållsmässan i Göteborg och Sifco ASC finns självklart på plats under hela mässan. Du är varmt välkommen att besöka oss!
Vi kommer att visa upp det senaste inom selektiv plätering.
Kom till monter B00:09 och träffa våra kunniga experter. De kan svara på alla frågor om våra produkter och hur vi skulle kunna hjälpa just er.
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