Purchasing three multi-layer extruders to support future growth
MONTRAL, April 21, 2022 /CNW Telbec/ - Imaflex Inc. ("Imaflex" or the "Corporation") (TSXV: IFX) is pleased to announce that it has signed equipment purchase agreements over the past quarter for three new co-extrusion blown film lines ("extruders") to help meet heightening demand for its products.
"In recent years Imaflex has seen consistent, profitable growth in its Canadian and U.S. operations," commented Mr. Joe Abbandonato, President and Chief Executive Officer of Imaflex. "During this time, we have been upgrading all major extrusion lines in order to meet heightening market demand for enhanced film quality, which permits our converting customers' equipment to run at ever increasing speeds. Simultaneously, and as forecasted, we successfully reached our goal of selling out the capacity of our higher margin 5-layer line. Demand has been so robust on the niche products we created for this line that we recently purchased three new co-extruders." They are expected to generate additional extrusion capacity of between 12 to 15 million pounds per year, depending on product mix. Once an extruder is installed and fully operational, it should be fully utilized within 18 months. Barring any supply chain challenges, the extruders are expected to arrive at varying intervals ending the second quarter of 2023.
"In preparation for the significant volume increase these investments will create, we recently strengthened our Canadian and U.S. leadership teams by adding two new results-oriented operations managers, who have deep flexible packaging industry experience," continued Mr. Abbandonato. Both individuals have a strong track record of success in managing and mobilizing teams and driving operational efficiencies, while optimizing production processes within and between cross-functional units. "Having these people in place will create and ensure our ability to generate and grow our organic revenues more aggressively in the coming years."
In connection with the equipment purchases, Imaflex has access to financing of CDN $10.0 million (the "loans"). The loans commence depending upon receipt of each extruder and the principal is to be repaid in 60 equal monthly installments. Currently, this financing would bear interest at 4.89%, however the interest rate will fluctuate going forward depending on the timing the loans will be disbursed.