Profile: Intertape Polymer Group Inc (ITP.TO)

ITP.TO on Toronto Stock Exchange

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19 Sep 2014
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Intertape Polymer Group Inc. (Intertape), incorporated on August 31, 1993, operates in the specialty packaging industry in North America. The Company develops, manufactures and sells a variety of paper and film based pressure sensitive and water activated tapes, specialized polyolefin films, woven fabrics and complementary packaging systems for industrial use and retail applications. The Company’s products include carton sealing tapes, including Intertape pressure-sensitive and water-activated tapes; industrial and performance specialty tapes, including masking, duct, electrical and reinforced filament tapes; Exlfilm shrink film; StretchFlex stretch wrap, engineered coated fabric products, and flexible intermediate bulk containers (FIBCs). These products are sold through a variety of industrial and specialty distributors with a focus on sales to the construction and agricultural markets, as well as the flexible packaging market.

Tapes

The Company manufactures a variety of paper and film based tapes, including pressure sensitive and water-activated carton sealing tapes; industrial and performance specialty tapes including paper, flatback, duct, double-coated foil, electrical filament tapes and stencil products. The Company is the only packaging company that manufactures tapes using all four adhesive technologies: hot melt, acrylic, natural rubber and water-activated. As a vertically integrated manufacturer, Intertape produces its own adhesives used in the manufacture of its finished tape. The Company’s tape products are manufactured and sold under the Company’s brands, including Intertape, Central, Crowell, American, Anchor, ExlfilmPlus, and Exlfilm, to industrial distributors and retailers, and are manufactured for sale to third parties under private brands.

In 2012, the Company redirected its focus to address specific solutions the Company is able to provide for targeted markets: fulfillment, general manufacturing, food processing and specialty (oil and gas, heating, ventilation, and air conditioning (HVAC), aerospace, residential and commercial painting, building and construction, and mass transportation). The Company’s tape products consist of two main product groups: carton sealing tapes, and industrial and specialty tapes.

Carton sealing tapes are sold primarily under the Intertape and Central brands to industrial distributors and retailers, as well as to third parties under private brands. The Company also sells the application equipment required for the dispensing of its carton sealing tapes. Hot melt carton sealing tape is a polypropylene film coated with a synthetic rubber adhesive which offers a range of application flexibility and is typically used in carton sealing applications. Acrylic carton sealing tape is a polypropylene film coated with an aqueous, pressure sensitive acrylic adhesive, which is suited for applications where performance is required within a range of temperatures from less than 40°F (4°C) to greater than 120°F (49°C). Natural rubber carton sealing tape is a polypropylene film coated with natural rubber adhesive and is among the carton sealing tapes because of its aggressive adhesion properties. This tape is ideally suited for conditions involving hot, dusty, humid or cold environments. Water-activated carton sealing tape is typically manufactured using a filament reinforced kraft paper substrate and a starch based adhesive that is activated by water. Water-activated tape is used primarily in applications where a mechanical bond or tamper evidence is required.

The Company produces eight primary industrial and specialty products sold primarily under the Intertape and American brands: paper tape, flatback tape, duct tape, double-coated tape, foil tape, electrical tape, filament tapes and stencil products. Paper tape is manufactured from a crepe paper substrate coated with a natural rubber or a synthetic rubber adhesive. Paper tape is used for a variety of performance and general purpose end-use applications. Product applications include paint masking (consumer, contractor, automotive, aerospace and marine), splicing, bundling/packaging, and general light duty applications.

Flatback tape is manufactured using a smooth kraft paper substrate coated with a natural rubber/SIS blended adhesive. Flatback tape is designed with low elongation and is widely used in applications such as splicing where the tape should not be distorted. Typical applications for flatback tape include printable identification tapes, label products and carton closure. Duct tape is manufactured from a polyethylene film that has been reinforced with scrim and coated with natural/synthetic rubber blend adhesive or specialty polymer adhesives. Duct tape is primarily used by general consumers for a range of applications. Duct tapes are also used in maintenance, repair and operations, in the heating, ventilation and air conditioning markets, construction and in the convention and entertainment industries.

Double-coated tapes are manufactured from a paper, foam, or film substrate and are coated on both sides with a variety of adhesive systems. Double-coated tapes also use a release liner made from paper or film that prevents the tape from sticking to itself. Foil tapes are manufactured using aluminum and a variety of adhesive systems. The tape is manufactured with a range of aluminum foil gauges and is designed for applications that range from HVAC, building and construction, aerospace, transportation, industrial, and general purpose. Electrical and electronic tapes are manufactured from a number of different substrates, including paper, polyester, glass cloth and a variety of adhesive systems that include rubber, acrylic and silicone adhesives. Filament tape is a film or paper adhesive tape with fiberglass strands or polyester fibers embedded in the adhesive to provide high tensile strength. Primary applications for filament tape include temporary holding (appliance), bundling and unitizing, subsea umbilical cables (oil and gas), metal coil tubing, and agricultural applications. Stencil products, sold under the Anchor brand, are manufactured from a calendared natural/synthetic rubber blended substrate with an acrylic adhesive and specially formulated adhesives. Stencil products are used in applications within the sign and monument manufacturing markets to protect a surface where sandblasting is required.

The Company competes with 3M Co., Shurtape Technologies LLC, Vibac Group, Pitamus, Sekisui TA Industries Inc., Primetac, Holland Manufacturing Co. Inc., Cantech, tesa tape inc., Berry Plastics Corp., Scapa Group plc., Avery Dennison Corp., and Nitto Denko.

Films

The Company also manufactures a variety of specialized polyolefin films, as well as complementary packaging systems, for industrial use and retail applications, including shrink film, stretch wrap and air pillows. As a vertically integrated manufacturer, Intertape produces its own adhesives used in the manufacture of its film. The Company’s film products are manufactured and sold under the Company’s brands, including SuperFlex, StretchFlex, and iCushion to industrial distributors and retailers, and are manufactured for sale to third parties under private brands. The Company’s film products consist of two main product groups, film and protective packaging. The Company primarily produces two film product lines: ExlfilmPlus and Exlfilm shrink film and SuperFlex and StretchFlex stretch wrap.

ExlfilmPlus and Exlfilm shrink film are plastic films, which shrink under controlled heat to conform to a package’s shape. The process permits the over-wrapping of a array of products of varying sizes and dimensions with a single packaging line. ExlfilmPlus and Exlfilm are used to package paper products, consumer products such as bottled water, toys, games, sporting goods, hardware and housewares and a variety of other products. Stretch wrap is a single or multi-layer plastic film that can be stretched without application of heat and which has the characteristic of trying to return to its original length thereby applying force on the wrapped load. It is used industrially to wrap pallets of various products ensuring a solid load for shipping. Air pillows are manufactured from polyethylene film and are inflated at the point of use with an air pillow machine. The Company markets both traditional polyethylene, as well as oxo-biodegradable, air pillow products. The Company has added a biodegradable film to its iCushion air pillow protective packaging products. Air pillows are used as packaging material for void fill and cushioning applications. Typical end-use markets for air pillows include fulfillment houses, contract packagers, and mail order pharmacies.

The Company competes with Sealed Air Corp., Bemis Co. Inc., Pregis Corp., Storopack, Inc., Free-Flow Packaging International Inc. and Polyair Inter Pack Inc.

Engineered Coated Products

The Company is a North American in the development and manufacture of industrial packaging, protective covering, barrier and liner products utilizing engineered coated polyolefin fabrics, paper and other laminated materials. Its products are sold primarily direct to end-users in a number of industries, including lumber, construction, food, paper, and agriculture. The Company’s engineered coated products are categorized in six markets: building and construction, agro-environmental, specialty fabrics, FIBCs, industrial packaging, and consumer packaging. The Company’s building and construction product group includes membrane structure fabrics used in clear span buildings and protective wrap for kiln dried lumber and a variety of other membrane barrier products, such as roof underlayment, house wrap, window and door flashing and insulation facing, which are used directly in residential and commercial construction. The Company also supplies packaging over-wrap sleeves for unitizing multiple bags of fiberglass insulation. Intertape Polymer Group’s lumber wrap is used to package, unitize, protect and brand lumber during transportation and storage. The product is available in polyethylene or polypropylene coated fabrics and polyethylene films printed to customer specifications. Lumber wrap is produced at the Company’s plants in Langley, British Columbia, and Truro, Nova Scotia. Nova-Shield is a lightweight, wide-width, and durable polyolefin fabric used as the outer skin layer for flexible membrane structures. The Company sells the Nova-Shield fabrics to membrane structure manufacturers who design, fabricate, and install the structures.

The Company has developed a range of Agro-Environmental products, including bags for packaging processed cotton, fabrics designed for conversion into hay covers, grain covers, landfill covers, oil field membranes, and canal and pond liners. The Company’s AquaMaster line of geomembrane fabrics is used as irrigation canal liners, golf course and aquascape pond liners, oil pad liners, hydraulic fracturing ponds and in aquaculture operations. Woven coated polyolefin fabrics are used in the construction of poultry houses in the southern United States. Materials with high ultraviolet resistance are fabricated into side curtains that regulate ventilation and temperature in buildings. Other materials are used in ceiling construction.

The Company’s specialty fabric product category is comprised of a variety of specialty materials custom designed for applications or specific customers. The Company’s ability to provide polyolefin fabrics in a variety of weights, widths, colors and styles, and to slit, print and perform various other conversion steps, allows it to provide an array of coated products designed to meet the specific needs of its customers. Products and applications of specialty fabrics include fabrics designed for conversion into pool covers, field covers, disaster relief materials, protective covers and construction sheeting, brattice cloth for mine ventilation, underground marking tapes, salt pile covers and industrial packaging.

The Company’s metal wrap is used to protect coils of steel and aluminum during transit and storage. The Company also manufactures custom designed fabrics for dunnage bags, which are used to fill space in a shipping container or to position the contents in a container. The production of the dunnage bag fabrics are primarily produced at the Company’s Truro, Nova Scotia, facility. FIBCs are flexible, intermediate bulk containers generally designed to carry and discharge 1,500 to 3,500 pounds of dry flowable products, such as chemicals, minerals and dry food ingredients. The market for FIBC’s is fragmented.

The Company competes with Interwrap, Inc., Fabrene Inc., Mai Weave LLC, Alpha ProTech, W.R. Grace, Inland Tarp and Covalence Specialty Materials Crp.

Company Address

Intertape Polymer Group Inc

2nd Floor, 9999 Cavendish Blvd
SAINT-LAURENT   QC   H4M 2X5
P: +1514.7317591
F: +1514.7315039

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