INTOCAST Sees Additional Market Potential with further External Growth
INTOCAST AG makes refractory products at a total of 23 sites, including eight in Germany. INTOCAST is one of the few manufacturers to cover its customers’ entire range of demand for shaped and unshaped refractories as well as casting auxiliaries and metallurgical slag additives. The user industries include, alongside the iron and steel industry, the producers of non-ferrous metals (especially aluminium), foundries, the cement and ceramics industry as well as the chemicals and petrochemicals industry. Moreover, INTOCAST products are used in power plants, thermal treatment furnaces and incineration plants. The company founded in Ratingen/DE in 1979 has grown as a result of acquisitions and holdings to a globally operating SME. In 2018, thanks to extensive acquisitions, considerable growth was realised, generating a rise in turnover from EUR 150 million to EUR 340 million, and an increase in the number of employees from 600 to 1350. We were able to discuss the background to this external growth and other strategic plans with the CEO Matthias Normann (MN). Fig.: CEO Matthias Normann rwf: Significant for the enormous growth was that at the end of 2017 INTOCAST won the bidding competition for divestment required by the EU to permit the
merger off RHI/AT and Magnesita/BR. What competences has this enormous growth of INTOCAST AG brought? MN: Essentially, being able to offer along-side our unshaped refractory products, a wide portfolio of shaped products produced in-house. We now own the former Magnesita plant in Oberhausen/DE, which produces magnesia-carbon bricks and basic mixes. On top of that come the dolomite brick plants in Morane, Italy, and Lugones, Spain. Also in Spain, another production plant for refractory bricks, Refractarios ARRILLAGA S.L., has been successfully acquired. With a wide array of refractory bricks in different grades and sizes as well as refractory mixes, we have enlarged our portfolio, and 95 % of the shaped products we supply are now produced in-house. This means we now have access to projects that we could never have handled if we had to buy in products “off the shelf”. With these new products, we have also gained key expertise in respect of installation and service, but also product development. rwf: Do you now have access to new user industries? MN: No, we have always had an extremely broad base. That has also brought us advantages in bidding competitions. In addition, with 70 % sales in Europe, we are regionally well networked in the market. That has considerably strengthened confidence in INTOCAST to continue to operating plants successfully. rwf: Were you able to realise a new organisational structure in the year 2018? MN: We are certainly a little proud of the fact that we managed to do that in just ten months because, of course, it entailed ensuring the on-time supply of customers just as much as internal aspects (organisational structure, accounting procedures, etc.). The sales organisation is set up such that our producing plants are in close contact with the customers. rwf: You have mentioned your strong presence in the European market. Here you must meet very high requirements for product quality and the reliable assurance of guaranteed parameters. For this, you have to use correspondingly high raw material grades. Have you been able to guarantee this quickly for the newly acquired plants? MN: Yes, because we were able to assure contractually that we can source the materials needed for the shaped refractories from the deposits of the previous owner for twelve years. With 43 000 t/a, that corresponds roughly to 60 % of our total raw material demand and has the added charm that for high-purity sinter we can rely on raw materials from a mine with an extremely high purity and quality. As a result, we don’t have to mix magnesite from different raw material suppliers, which is a quality advantage especially in respect of the reliability of the product parameters. rwf: How do you rate your chances in the market outside Europe besides your above-mentioned strengths in Europe? MN: Outside Europe, we are represented with our own subsidiaries in China, Russia, India and South Africa. With regard to the intensification of market activities, I should like to pick out South and Central America as well as India.
As we are committed to individual customer consultation and technical support of full-service projects, it is always important to score points with production and regional market know-how. This influenced our investment in Hi-Tech in Jam-shedpur/IN, which now operates under the name INTOCAST Hi-Tech. In India’s fast-growing market we need this direct market access and have gained in this connection isostatically pressed products including their technology. rwf: How have you adapted your R&D organisation in respect of widening your portfolio? MN: We operate an efficient technology centre in Krefeld/DE and decentralised developments in the plants in India, Slovak Republic, South Africa and Russia. Dolomite Franchi/IT, as our expert in dolomite bricks, operates fairly independently of this R&D organisation. Otherwise, Krefeld works together with the decentralised laboratories in the plants on topics such as developments for customers and qualification of raw materials. A total of 72 employees are assigned to R&D work. Only last year, Dolomite Franchi proved what can be achieved with high-quality dolomite bricks at ArcelorMittal in Brazil. 40 linings (corresponding to 1200 t) on the basis of the Pentabricks were supplied.
In the meantime, in the plants, a record durability of 164 melting cycles with a potential of up to 192 melting cycles have been confirmed (compared to 105 possible with the previously used products). That has been rewarded by the customer with handsome follow-on orders. This project also shows that we can successfully place ourselves in South America. rwf: With the casting auxiliaries and metallurgical slag additives you are, besides inorganic refractories, entrusted with work that metal smelting brings. Does this business, which has been operated since the founding the company’s founding, bring you more insights for you work as a “solution provider” for the customers? MN: Naturally, we have greater in-depth expertise in those issues that the customers have to resolve in their production operations. We can offer a wider customer service as a result. It is important to us to be able to respond quickly and flexibly, for that reason our geographic proximity is important. In this context, I can mention our new company established in Romania in 2018 as another example. With INTOCAST RO S.R.L., we now have a new production and service base in Galati/RO. Its optimum geographical location enables us to optimise service in the entire Balkans region and be closer to the customer. rwf: Are you still committed to external growth? MN: Yes, that doesn’t necessarily have to be outside Germany or outside Europe. We have a demanding high-tech market “on our doorstep”, where we have repeatedly proven ourselves with flexibility and speed in problem solutions. Here, too, an add itional consolidation of our good position is feasible. rwf: Thank you for talking to us.