Fuchs Grease Plants Progress


Fuchs new factory in Chicago will produce 29 different specialty greases, and its new plant near Johannesburg, South Africa, will produce a diverse range of greases starting in summer of 2017, according to the companys 2016 annual report.

The report said the completed Chicago factory, which is located in the citys Harvey district, is scheduled to open in the first half of 2017 and will produce greases as part of the companys 3C commitment to offer identical grease for original equipment manufacturer customers on three continents.

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The independent lubricants blender said in its report that the new grease plant near Johannesburg will have technology that allows it to meet South African customers constantly rising demands.

Paul Deppe, managing director of Fuchs Lubricants South Africa, told Lube Report in an interview in August 2016 that the company had identified South Africa as a hub for the manufacture of grease that will be distributed throughout Africa and that the company was investing in the building of a new grease plant in South Africa. Deppe said the plant will have a capacity in excess of 4,000 metric tons per year, and although designed to manufacture lithium, lithium complex and aluminum complex greases, it will have the flexibility to manufacture other types if required.

The annual report also included final earnings figures for the year, after the release of provisional data in February. The company posted 260 million (U.S. $281 million) in profit after tax for 2016, up 10 percent from 236 million in 2015. Sales revenues for 2016 reached nearly 2.3 billion, up 9 percent from 2.1 billion.

Revenue in Europe grew 15.5 percent to 1.4 billion. Fuchs said its business in Europe was significantly strengthened by both of the previous years acquisitions: Sweden-based Statoil Fuel & Retail Lubricants AB; and German lubricant blender Deutsche Pentosin-Werke GmbH. Thus in Germany, Scandinavia, the Baltic countries, Poland and Russia, good double-digit growth in sales revenue was also achieved, the company noted. Fuchs said its investments in 2016 included a land plot in Sweden where the company will build a factory to replace one that it currently rents.

Organic growth in Germany, Central and Eastern Europe was above average, with one key exception. One of the exceptions in the positive business development was the business in the U.K., which suffered from the consequences of the Brexit decision, Fuchs noted in its annual report.

Sales in Asia-Pacific and Africa grew 6.3 percent to 620 million. The company said it intensified market cultivation in Asia-Pacific and Africa in 2016. As in 2015, the companies in China, India, Australia and South Africa achieved considerable increases in sales volumes. Fuchs expects to complete a new 80,000-square-meter lubricants factory in China in Wujiang, Jiangsu province, by the end of 2018. In Australia, the company expects to commence operations at a new lubricants factory at Beresfield, near Newcastle in New South Wales state, in April this year.

Revenue in North and South America slid 1.2 percent to 349 million, which the company attributed to weak development of sales revenues in North America. Increased costs caused by inflation and investments were not offset by the planned increases in gross profit, the company said. Fuchs noted that as in 2015, North America achieved good sales revenues in the original equipment manufacturer business. On the other hand, demand in the U.S.A. and Canada again did not meet expectations in important sectors such as the steel industry, the company stated. However, the turnaround during 2016 is encouraging. This had already occurred in Argentina and Brazil several months earlier.