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Nfld. Styro expansion means new opportunity

By Kelly Foss, The Advertiser
August 3, 2000

Newfoundland Styro Inc. is at it again. The 12th fastest growing company in Atlantic Canada is doing what it does best, growing. A recent purchase of equipment from LaFarge Canada's site in Corner Brook has moved the company into yet another business opportunity. Dave MacNearney said his company manufactures products from expanded polystyrene, and at this point, that's mostly fish boxes.

"It's a bead-based product, and what we have done so far is called shape molding, where you put the raw material into the mold and it comes out in that shape," he explained. "But that's only half of the expanded polystyrene manufacturing business. The other half is block molding. With that you take a really big mold that's 16 feet long by four feet wide and two feet thick. That's filled with raw material and makes a big cube. We then take hot wires and cut it into sheets and more complex shapes."

The block molding equipment is what the company purchased from LaFarge. They had been in negotiations for about eight months and decided to put in an order to buy the same equipment, only new. That's due to arrive in September, and when it does, they hope to build an addition to their factory to house both sets of machinery. This will be the second time they've made additions to their site in less than three years. "We broke ground in August 1996 and started production in February of 1997," said Mr. MacNearney.

"To me, this purchase is not a big leap. Objectively it is, but every two months, we've been adding new products anyway. We started out just doing six different types of fish boxes, then we got into insulated concrete forms. Then we added gel packs, and now we're making 10 types of fish boxes. So it's just a natural progression."

Insulated concrete forms are a hallow foam block that are stacked and filled with concrete. The foam is the form work for the concrete and becomes insulation. Inside the foam are steel studs so builders can screw their drywall and siding right to the foam. That is the beginning of the company's move into the construction industry, which will be aided by the block mold purchases.

"We want to offer a full line of insulation productions, but we also want to stay in keeping with what we do best, which is make foam," said Mr. MacNearney. "We also sell the accessories that go with it. We make the foam box, but we also stock polybag liners, corrugated outer liners, and we make gel freezer packs to go in them. We want to give our customers one stop shopping, but our primary business is foam."

Their main competitors are Styrofoam, the blue board that has a smooth shiny surface, and fibreglass, the other house insulator. "Fibreglass has 90 percent of the market and foam has 10 percent, "explained Mr. MacNearney. "The foam manufacturers tend to fight among themselves for that 10 percent, when we should be going after that 90 percent."

By buying LaFarge's assets, Mr. MacNearney said they actually bought their customers as well, but they hope to be able to grow on that by changing the name and emphasizing that they're producing a quality product. Right now, they're waiting for permission from government to set up the new equipment. "It's a boiler and other high pressure equipment, so we have to get an engineer to do drawings which government will approve and give us a permit," said Mr. MacNearney.

When that equipment becomes operational, the company will get back to its plan of slow continual growth. "Our long-term plan would be to get into making rigid insulation, making a good quality product, and then increase market over time by taking it from the competition," he said. "I think in the next couple of years, we'll see more consolidation. We've got enough on our plate now, and what we'd like to do is to make a quality product and sell it at a competitive price."

In The Press

• Local manufacturer named as one of Top 50 CEO's for 2001 in Atlantic Canada (Atlantic Business Magazine April/May 2001)
• Economic boom expected by mayor (The Advertiser October 23, 2000)
• An ACOA Success Story (The Telegram October 30, 2000)
• Nfld. Styro expansion means new opportunity (The Advertiser August 3, 2000)
• Bishop's Falls, Nfld. - Small Town with a Big Heart (Business East, February/March 2000)
• Irish manufacturing deal inked (The Advertiser)