Insulation industry news from Global Insulation

US: With the housing market bottoming out and showing signs of recovery, demand for flame retardants will also begin to improve, according to a report from Global Information Inc.

It says that demand for flame retardants in the US is expected to grow by 4.6%/yr year to reach around US$1.5bn in 2016, a significant rebound as the industry benefits from an improving economy and a turnaround in key markets.

Global Information says that construction-related applications of flame-retardants will provide the biggest impetus to growth and continue to account for the greatest share of sales in the market for flame retardants. Boron and phosphorus-based flame retardants will expand at the fastest rates. Brominated compounds will benefit from use in polystyrene and polyurethane insulation.

Egypt: GlassRock Insulation Co. has started targeting exports of mineral wool to key markets in Europe, North Africa, the Gulf Cooperation Council countries and Turkey following the start of production at its US$70m Egyptian greenfield facility in May 2012. The company, part of a portfolio owned by Citadel Capital's regional mining platform ASCOM, will also begin production of glass wool insulation in September 2012.

"Our goal is to become a world-class provider of heat and noise insulation solutions," said GlassRock Insulation chief executive officer Bechir Dardour. "Energy-efficient building materials are the only option going forward in Egypt and around the world and we are delighted to be part of the solution to the creation of a greener, more environmentally-friendly future."

Construction of the US$70m greenfield GlassRock plant, located eqhalf-way between Cairo and Alexandria in the Sadat City Free Zone, began in 2010. The facility has created 260 direct jobs and operates with technology licensed from Italy's Tenova. When fully operational GlassRock's production capacity will be 30,000Mt/yr of mineral wool and 20,000Mt/yr of glass wool.

Russia: Saint-Gobain has bought a 25.1% share in ISOROC, a Russian building materials company based in Tambov. The cost of the acquisition has not been announced nor has Saint-Gobain revealed who sold the shares. The transaction is in line with Saint-Gobain Group's expansion strategy that enables it to continue growing its insulation activity in Russia.

ISOROC is a leader in the central region of Russia for mineral wool products, the most commonly used insulation material in the Commonwealth of Independent States (CIS). The company reported revenues of Euro46m in 2011.

According to the SPARK database, Germany's Erste AMSC Unternehmensbeteiligungs GmbH owned 37.94% of ISOROC as of 7 September 2012, the European Bank for Reconstruction and Development (EBRD) owned 35.93% and Rabo Black Earth B.V. owned 7.18%.

Saint-Gobain previously announced in June 2012 that it had acquired British insulating foam producer Celotex to strengthen its position in the UK insulation market.

UK: PipeHawk, a provider of advanced engineering solutions, has announced that its OM Systems subsidiary secured a contract with Kingspan to deliver a complete new production line, worth over Euro1.25m. The project comprises the provision of a turnkey automated production line to one of Kingspan's UK facilities and will be delivered during 2012-2013 financial year.

Denmark: Rockwool International has released its first half financial results for 2012, which show a generally improving picture. The group generated sales in the first half of 2012 of Euro919.9m, corresponding to an increase of 9% compared to same period of 2011. External sales in the group's insulation segment increased by 9% to Euro758.1m. Part of Rockwool's improved financial picture is due to an increase in the number of plants it operates. In the first six months of 2011 it opened a production facility in Russia and increased activity in India, North America and elsewhere.

Earnings before interest, tax, depreciation and amortisation (EBITDA) for the group reached US$126.7m and earnings before interest and tax (EBIT) came to Euro57.7m, an increase of Euro18.2m (EBIT) compared to the same period of 2011. In the first half of 2012, the insulation segment EBIT came to Euro40.0m, an increase of 87% year-on-year.

In the western European insulation market, Rockwool reported that the good trading conditions observed in France and Germany since 2011 had continued for the group during the second quarter of 2012, offsetting the negative trends seen in countries like Spain, the UK and the Netherlands, in which it is experiencing increasingly difficult market conditions. In eastern Europe, Poland has continued its strong recovery, whereas Russia is seen by Rockwool to be levelling out, albeit with a small increase in sales compared to the first half of 2011.

Sales in North America continued to develop well. In Asia, and particularly in China, demand for non-combustible insulation material is increasing and is likely to be even stronger when new Chinese regulations regarding fire safety in buildings come into force.

Sales prices have continued to increase during the second quarter of 2012, however at a lower level than during the first quarter and with large differences between markets. The inflation on most raw materials was still high for this period although Rockwool started to benefit from lower foundry coke prices deriving from more reasonable coking coal prices.

Looking ahead to the remainder of 2012, Rockwool expects the general slowdown of the western European economy and the Euro crisis to have further negative effects on the new-built insulation markets, although refurbishment is expected to be resilient. In eastern Europe including Russia, Rockwool expects insulation markets to show robust double-digit growth. The very positive sales development in North America is expected to continue, well supported by better market conditions. In Asia, its sales development will be limited by the as-yet unsolved logistical challenges of importing products from Europe. Overall, the group expects its net sales at current exchange rates to increase by at least 5% for the full year 2012.

Despite the slowdown of the world economy Rockwool says that it expects a continuation of inflationary pressures in 2012 and it will maintain its focus on increasing sales prices and cost-control. It forecasts a net profit for the whole of 2012 in the region of Euro87.3-93.8m.