By Edward C. Gregor, Editorial Board Chairman, International Filtration News
SWM International, (NYSE:SWM) is a globally recognized specialty materials company, headquartered in Alpharetta, GA. Dating back several centuries to Europe, SWM was historically focused on fiber-based specialty papers. SWM has now established its Advanced Materials & Structures (AMS) business to include expertise and capabilities in resin-based material technologies. As part of this effort, SWM acquired and integrated several global materials companies specializing in market-leading high-performance nettings, TPU films, and non-wovens, including DelStar Technologies (2013), Argotec (2015) and Conwed Plastics (2017). As part of the Conwed acquisition, SWM also acquired its subsidiary Filtrexx International, a leader in the research and development of sustainable, compost-based solutions for sediment control and storm water management.
Many in the industry know DelStar and Conwed for their extruded netting, particularly the feed spacer nets used in reverse osmosis (RO) filtration, as well as meltblown media for air and liquid filtration, and electrostatic media for air filtration. Beyond filtration applications and technologies, SWM has other diversified capabilities, including paper (various fibers), TPU film, netting, yarn, and engineered composite materials, which are used in a variety of other end-markets ranging from transportation to construction to medical. SWM appears to be adding a platform of specialty material companies as an overall business strategy.
To get to know SWM better, we interviewed Dr. Jeffery Kramer, CEO. As SWM has acquired several businesses with deep roots in filtration, the objective is to help us understand the company’s current and future filtration business aspirations, thinking and positioning.
Ed Gregor: SWM International has assembled a recent impressive array of material technologies as a business strategy. Why filtration?
Jeff Kramer: First off, thanks for acknowledgement on our portfolio. We are excited by its capabilities as well. As to why filtration, we choose categories which play off our competitive strengths and have positive long term trends. In this case, the growing global megatrend for cleaner, purer products and processes creates a great opportunity for our business. Delivering against this opportunity requires uniquely designed products and collaborative customer relationships which play to our strengths. At our core, we are engineers of high-performance materials that solve our customers’ problems, and we back up our technical expertise with best-in-class global manufacturing, quality, innovation and customer support. We have a broad portfolio and are heavily involved in filtration from large reverse osmosis plants to applications across semiconductor production, energy and a host of industrial applications.
Ed Gregor: Please share your initial experience in the filtration marketplace?
Jeff Kramer: While our AMS division might be considered reasonably new, our underlying operations have been involved in filtration for much longer. We have deep and long-standing customer relationships across many filtration sub-segments. Our customers typically rely on us to provide a critical component of their customer end products, and our materials’ functionality and reliability impacts the final performance of the system. They count on our design skills and our ability to repeatedly deliver quality materials. That drives collaboration for continuous improvement, and our commitment to that process yields outstanding customer loyalty.
Ed Gregor: Do you believe there could be additional filtration industry materials or component parts acquisitions in SWM’s future?
Jeff Kramer: Yes. As this is a space we are committed to for the long-term, we continue to evaluate acquisitions in filtration. But we are constantly focused on product innovation to drive growth. Bringing our broad portfolio of technologies and our research and development capabilities to bear to solve customer problems makes filtration an exciting growth market for us.
Ed Gregor: Looking into your crystal ball, do you foresee SWM considering going downstream into finished products, beyond component materials?
Jeff Kramer: We are always reviewing our strategy to ensure we have a healthy portfolio with good growth opportunities. We like where we play today and believe we have substantial opportunities to leverage our strengths for profitable growth.
Ed Gregor: What are your overall thoughts about SWM’s growth potential in the filtration industry?
Jeff Kramer: As noted, earlier, we like to focus on segments which benefit from megatrends, as they offer the best tailwinds for innovative companies to grow. Filtration is one of these areas. One example of a sub-segment of the cleaner, purer trend we follow for filtration is the increasing global need for safe drinking water. We have a major role in the production of high-performance filtration cartridges for large scale desalination plants that are critical for delivering drinkable water. Another example is the need for even purer materials for semiconductor production. Demand for these products continues to increase and it’s an area where we also participate. Overall, we are optimistic about trends in filtration, and believe we are well positioned to deliver innovative and effective solutions for our customers and profitable growth for our shareholders.
Ed Gregor: At this time, do you foresee circumstances where SWM would favor an increased presence in either air and/or liquid filtration as a long-term strategy?
Jeff Kramer: We currently play in both segments and are always looking for ways to expand our presence. While currently our business is weighted more towards liquid filtration, we have compelling products in air filtration, particularly in higher-end HVAC with our electrostatic technology. As we look at investment opportunities, we focus on areas where we have industry-leading know-how and can deliver unique products designed to meet demanding specifications that will solve customer problems.
Ed Gregor: SWM is becoming recognized as a serious filtration player with active participation in trade expositions, advertising and related promotional activities. Have you found this beneficial?
Jeff Kramer: Absolutely. We definitely see the benefits of showcasing at trade shows. Our filtration products, like Naltex® Extruded Netting, have long enjoyed strong brand recognition and the industry is very familiar with the DelStar and Conwed trade names as well. Trade shows and industry events are great ways for us to now educate our customers about our broad SWM portfolio and expanded expertise, give them a chance to touch and feel our materials, and talk to us about their specific needs. Our customers are at the heart of our organization and we want to take every opportunity we can to meet them face-to-face.