Georgia Gulf Says Royal Integration Ahead of

April 1, 2007
Companies

Integration of the Royal Group extrusion business into Georgia Gulf Corp. “is ahead of plan with initiatives to capture synergy and improvement opportunities,” according to Edward Schmitt, Georgia Gulf president, CEO and chairman. In reporting its 2006 year-end results, the company estimates that implemented programs will save from $55 to $70 million per year, with the benefits expected to be realized in 2007.

Georgia Gulf, which manufactures PVC resin, acquired the extruder of vinyl window and door profiles last October, as part of its “chlorovinyls forward integration strategy.” Georgia Gulf plans to leverage its vinyl resins and compounds formulation expertise with Royal’s extrusion and product development experience.

Georgia Gulf reports 2006 sales of $2.4 billion compared to $2.3 billion for 2005. The company noted that fourth quarter sales, which included Royal earnings, were down from the prior year, due to weakness in the building and home improvement market.

“Challenging market conditions are expected to persist through 2007,” Schmitt adds, adding that the slumping market will overshadow the positive impact of synergy and improvement programs in the short term. “As the construction industry emerges from its downturn, we will be well along in the execution of our integration plan and well positioned to serve our markets,” he concludes.