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Potential sale not affecting activity at Phillips.

News of an impending sale always makes news in any industry and nonwovens is no exception. This year, Phillips Fibers, Greenville, SC, has the distinction of being in the "For Sale" category, as parent company Phillips Petroleum announced in March it was considering the sale of its subsidiary. The sale was not an indication of poor performance by Phillips Fibers--of which the nonwovens business is a part--but rather a means of gaining capital by divesting a non-core and capital intensive business. The entire Phillips Fibers subsidiary had 1992 sales of approximately $185 million.

While the company has now been for sale for several months, Phillips has given no indication of prospective buyer activity Although nonwovens supplier Phillips Fibers declined to comment on the sale of the operations, according to industry sources, there has been a lot of interest in the company and the sale is expected to take place within a specific time frame.

Despite the imminent sale, it has been business as usual, said Ted Kelly, vice president-marketing. "Our people have done remarkably well and our customer base, almost to the customer, has been very supportive."

Phillips Fibers, notorious for its broad range of new products introduced on a regular basis, actually spent the last year concentrating more of its focus on commercial rather than product development. "We are now concentrating on selling these products," said Thomas Oakley, director-nonwoven fabrics marketing. Phillips has held several joint seminars with customers and is working on distributor training, concentrating its attentions on the end user. "Market development efforts continue with a high percentage of new programs evolving from existing markets. Obviously, you gravitate towards what you know best.

"Overall, our product line is fairly complete," explained Mr. Oakley. "Now we need to bring our new products to the level where we are pleased from a commercial point of view. Our business started off very strong this year," he continued. "Our textile nonwovens in particular are above our forecast and we expect this to continue." He added that the geotextile market, which is a very seasonal business, is also doing well.

In analyzing the market, Mr. Oakley said, "We went into this year expecting any possible progress roadblocks to come from competitive situations. Now we're very bullish about the market and it is more an issue of government funding problems. Our country is still far behind from an infrastructure point of view; given this we forecast a strong future."

Phillips continues to concentrate on the domestic market, doing only selected exporting. "By and large, as a roll goods producer you really need to be making something pretty unique to justify shipping it internationally," said Mr. Kelly, although he did say some of the company's higher value added products were being exported. "It's not a high percentage, but it is significant," said Mr. Kelly.

ISO certification is also a focus at Phillips, although this falls under the company's quality umbrella. "We have zeroed in on ISO as our goal," said Mr. Kelly The company has begun the initial work towards the certification and expects to achieve it during 1994. "We are working to have all of Phillips Fibers Corporation certified, not just one particular product line," said Mr. Kelly. The company last year received Ford's Q1 certification as a supplier to the automotive industry. "It's one of those |given's," said Mr. Kelly "You must have a quality product to be successful."

Despite the questions surrounding the sale, Phillips remains very bullish about the future, predicting a strong finish for 1993 and into 1994. "Business is good," said Mr. Kelly. "We are making it happen with the resources at hand while continuing to move forward. Building the business is still the plan," he concluded.
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Title Annotation:Phillips Fibers Corp.
Publication:Nonwovens Industry
Date:Sep 1, 1993
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