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Kennametal makes move in China trade with Tianjin plant
US hardmetal tooling giant Kennametal Inc, based in Latrobe,
Pennsylvania, has announced plans to build a new manufacturing
plant in China located in the Tianjin Economic Development
Area. The company will invest $30-$40 million in the first
phase of the facility which is estimated at 161,000 sq ft.
The new plant, scheduled to be operational by mid 2006, will
make tungsten carbide cutting-tool inserts, wear parts, and
carbide drills, as well as providing carbide-drill reconditioning.
Kennametal reports that the facility could grow to more than
375,000 sq. ft. and employ 400 people. The company, which
began operations in China in 1991, has current annual sales
there in excess of $50 million.
And the US/German parent company of MIM furnace builder
Elnik systems has announced further expansion in China. The
Crystal Growing Systems division of PVA TePla AG has signed
a Letter of Intent with a solar industry company in China,
prior to a seven-year co-operation agreement. The planned
agreement is subject on both sides to approval by the respective
supervisory bodies; the intention is that it be finally concluded
by the beginning of May 2005. The cooperation agreement provides
for the supply and delivery of several hundred crystal growing
systems for solar silicon wafers. In the first delivery phase,
comprising the first two years, around 140 such systems are
to be installed in China.
As announced by CEO Peter Abel and the head of the Crystal
Growing Systems division, Martin Gier, the systems are to
be ordered by the customer under the co-operation agreement
in a series of packages, with a separate contract being concluded
for each package. The system components are predominantly
manufactured in Germany; the initial order volume is expected
to be up to EUR 50 million in the first two years.
PVA TePla achieved a turnaround in fiscal 2004, confirming
its previous earnings forecast. Group revenues rose to E44.2
million (2003: E38.9 million), and the gross margin to almost
29 per cent (2003: 26.7 per cent). With business looking brighter
in the course of the year, the fourth quarter generated further
substantial growth in revenues and earnings in all three divisions.
Cost savings resulting from restructuring activities successfully
completed by mid-year led to improvements in both gross margin
and earnings. With a positive cash flow of E5.1 million (2003:
E -4.7 million), the Group improved its internal financing
considerably. The book-to-bill ratio is high, at 1.2, due
to an extensive increase in incoming orders to around E55
million (2003: E38.1 million). The Group started the 2005
business year with E 20.2 million in order backlog (2004:
E11.0 million).
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