Forget what you think you know about private equity and manufacturing companies. Any preconceived notions about emphasizing cost-cutting and the bottom line at the expense of development and innovation don’t apply to Pexco. Besides which, the company is run by an engineer.
Based in Atlanta, Pexco LLC (pexco.com) is among the largest North American profile extruders. With nine plants in the U.S. and Mexico, Pexco is a major player in providing standard and custom parts and components (sheet as well as profiles) to OEMs and end-users in a variety of markets—notably aerospace, retail, traffic safety, medical, lighting, and fences. Pexco is certified to ISO 9001:2008, ISO 14001:2004, and OSHAS 18001:2007, and also AS9100C at its plant in Yakima, Wash. Pexco operates three medical clean rooms—one in Athol, Mass., and two in Mexico. All told, Pexco runs about 140 extrusion lines (supplied primarily by Davis-Standard) with more than 200 extruders in over 768,000 ft² of production space.
The roots of the Pexco story date back six decades. It started out as the plastics division of American Filtrona, then became a division of Bunzl, then it was Filtrona again. During this period, the manufacturing facilities were run as separate entities, which was not conducive to maximizing economies of scale.
In March 2009, Filtrona was acquired by private-equity firm Saw Mill Capital Partners of Briarcliff Manor, N.Y., and was renamed Pexco. “You can’t paint private-equity companies with broad brushstrokes,” remarks Neil Shillingford, an engineer who is now Pexco’s CEO. “What has occurred since the Saw Mill purchase is quite the opposite of what some might have expected to occur after being spun off from a public company. During the recession we expanded sales, added engineers to the team, and invested in R&D. We rode through the downturn and emerged stronger than we were before.” Sales growth this year is pegged at 17%, says Shillingford, a 21-year-veteran of Pexco.
As you might expect from a company backed by venture capital, Pexco has grown substantially through acquisitions. So far this year, Pexco has acquired three firms. One was AllWest Plastics, Inc., Huntington Beach, Calif., a custom profile extruder specializing in aerospace and lighting, whose customers include Boeing, Airbus, Bombardier, and Embraer. Another acquisition was Multitube Medical Devices S.A. de C.V. of Mexicali, Baja California, Mexico, which focuses on custom extrusions for medical devices, health and safety, and consumer products. The third was Patrician Products, Inc. of Hicksville, N.Y., an extruder of fence and lawn/garden products distributed through commercial and retail outlets such as Lowe’s and The Home Depot. Shillingford notes that one additional acquisition could close before the end of the year, adding that “there is a pipeline of targets outside of North America” that could become part of the Pexco family in the years ahead.
Besides acquisitions, the steps Pexco took to fortify its engineering resources through the recession have led to a good deal of organic growth as well. Pexco runs about 50 million lb/yr of a wide range of materials, ranging from engineered resins such as polycarbonate, ABS, acrylic, polyetherimide, and nylons to PVC and HDPE—all in a wide range of formulations. That type of flexibility, combined with its in-house tooling capabilities (five diemaking shops) gives Pexco the ability to custom design and engineer solutions, not just parts, with quicker turnaround times, Shillingford says.
Pexco also has a range of post-extrusion fabrication systems, allowing its customers to cut costs by paring down the number of suppliers needed to produce a final part. These services include in-line fabrication operations such as drilling, cutting, embossing, water-jetting, sonic welding, and printing. Offline fabrication includes drilling, mitering, and milling. Pexco also offers custom labeling, packaging, and kit assembly.
ROLL UP THE INNOVATION
Pexco put a lot of these capabilities to the test earlier this year when it helped Whiting Door Manufacturing Corp. in Akron, N.Y., launch all-plastic roll-up doors for trucks and trailers. Whiting Door is credited with developing the first overhead roll-up door for trucks and trailers in 1953. The challenge for Pexco’s engineering team was to create a custom product that would meet strict tolerances, withstand harsh weather and operating conditions, and lighten the weight of a 190-lb roll-up dry-freight door by 20%.
In place of a traditional sheet-metal over plywood exterior, Whiting specified that the new panels should be coextruded and made from ABS for its strength and rigidity with toughness. Pexco engineers developed a coextruded combination of ABS with an outer layer of an undisclosed automotive-grade polymer. The polymer eliminates the need for paint since it can be custom colored at the extrusion line. The color won’t fade because the coating polymer is UV protected for color and gloss.
For a weather-tight seal, the panels are contoured along the edge during the extrusion process to provide a tongue-and-groove channel that accepts a joint seal during door assembly.
The panel’s interior houses steel inserts that replace the traditional plywood core and serve as a webbing to provide stiffness, stability, and a solid backing for standard hinge fasteners. Since the inserts are affixed to the interior of the door using pop rivets, the exterior face is completely smooth. This clean exterior is a big advantage for customers who want to fully customize the door with graphics.
The tensile webbing design requirement was a key challenge for Pexco since it could not be displaced or dislodged during repeated rolling up and down of the finished door, and the design did not include the exterior stiffeners that are used in competing designs.
The Whiting Shield Series I all-weather truck and trailer roll-up door is now on the road in hundreds of installations, withstanding the rigors of transportation in a variety of climates.
DIVERSITY IN MARKETS
According to Shillingford, Pexco’s core business is custom extrusion, applied to a variety of segments, each with select design needs. “The best way to describe it is in the tagline we use to market our capabilities: ‘What will you make today?’”
The company’s custom business is focused on commercial, industrial, and life-science markets, with six specialty segments: aerospace, lighting, traffic, fence, retail point-of-purchase, and medical. Because of its diverse and proven experience, Pexco is also able to deliver custom applications in new markets ranging from consumer products and refrigeration to lawn and garden, construction and environmental.
Within the aerospace sector, Pexco is Boeing’s exclusive supplier of profile parts, and supplies many of the world’s leading airlines as well. Pexco has been pivotal in aiding Boeing and its suppliers in developing the 787 Dreamliner interior with components ranging from heat-formed, coextruded seals to innovative seat-track covers that allow for rapid rearrangement of the cabin fixtures. In addition to new aircraft interior components, Pexco is a leading supplier of aftermarket extruded and machined plastic and composite parts for Boeing and Airbus aircraft.
In lighting, Pexco supplies general-purpose, patterned polystyrene sheet as well as Durafrost acrylic. Many of Pexco’s lighting customers have already developed T5 fixtures that utilize its extruded light lens.
Pexco’s traffic control products, marketed under the Davidson Traffic Control line, are a family of impact-resistant posts, work-zone pavement markers, modular curb systems, guard-rail and sign-post reflectors, pedestrian safety signs, snow poles, and barricades that are used worldwide.
With a 45-year pedigree, Pexco retail group makes point-of-purchase merchandising solutions, including aisle markers, banner hangers, end-cap headers, grip-sign holders, menu/spiral boards, wire/peg hooks, shelf dividers, and pusher systems.
For more than 35 years Pexco has been the largest manufacturer of chain-link enhancement products, such as vinyl-based vertical fence slats, marketed under the PDS brand name. The slats are intended to lend privacy and security and enhance the appearance of any chain-link fence system.
Pexco’s medical tubing products range from complex multi-layer and multi-lumen tubes to wire-encapsulated tubing, as well as other complex custom profiles.
Pexco’s ability to be a major player in a wide range of markets and its custom capabilities have been key parts of its success. While some plants have a particular expertise in a market or product area, each of Pexco’s plants can produce any product as needed. “The strategy is to make a product at a site that is most convenient for the customer,” Shillingford explains.