Heavyweight and belting may be associated with boxing, but Fenner takes them on outside the ring. The company is among the world's top manufacturers of heavyweight belting. Fenner straddles two divisions. The company's Engineered Conveyor Solutions (ECS) Division makes rubber ply, solid woven, and steel cord conveyor belting for mining, power generation, and industrial use. Advanced Engineered Products (AEP) makes polymer products that include precision drives for computer peripherals, copiers, and ATMs; seals for fluid power and oil and gas equipment; rollers for digital image processing; silicone and complex hoses for heavy duty trucks; and power transmission and motion transfer components.
On the back of robust activity in the company's core markets, especially the energy and mineral extraction sectors, year-over-year revenue rose 30% and underlying operating profit surged 60% - a record -- in 2011. Operating profit went up 67%.
Year-over-year revenue for its largest division, ECS, which supports the company's mining services and accounts for more than 70% of sales, rose 31% in 2011 behind good results in the Southern Hemisphere and strong sales of steel cord conveyor belting.
Fenner expanded its business for this division in Australia -- a country that has been especially generous with strong sales -- through the acquisitions in 2010 of Belle Banne and Leading Edge Conveyor Solutions (together known as BBV) and of Statewide Belting Service in 2011. The ECS division operates under the Fenner Dunlop, Fenner, and Dunlop brand names.
Year-over-year revenue for the company's AEP division increased 27% thanks in part to strong sales of seals from customers in the hydraulic and oil and gas sectors. This division comprises five precision polymer businesses. Fenner Precision makes polymer components for office automation equipment. Fenner Drives designs and customizes systems and products for motion transfer applications. James Dawson provides silicone and hoses for heavy equipment. Fenner Advanced Sealing Technologies produces seals for mobile hydraulic equipment and mining and oil and gas equipment. Solesis Medical Technologies includes Secant Medical (textiles for implantable medical devices); Xeridiem (single use disposable devices); and Prodesco (industrial fabrics.).
For the AEP segment the company acquired two companies in 2011: Singapore-based Mulitseals, which makes seals for the Asia/Pacific oil and gas industry, and Australia-based Transeals, which makes seals for hydraulic equipment.
For its business as a whole Fenner is optimistic about further growth in response to several trends. Fenner Drives, Fenner Precision, and James Dawson are positioned to meet growing demand for energy efficiency and renewable energy in response to concerns about climate change. Xeridiem and Secant Medical are expected to benefit from an increasingly aged demographic in the developed world and the general expansion of health care in Brazil, Russia, India, and China. ECS and FAST are ready for growth in sales from a coal-mining industry tasked with meeting growing energy demand in China and India. – less