Newsletter - June 30, 2010President's Message
What a difference a few months makes. While it is too early to say the recession is officially over, the general mood is certainly better and we are looking to the future with greater confidence. IBC's order book is strengthening as customers are slowly gaining the confidence to move from production orders to re-stocking orders. This is an important metric and one we monitor closely as it is essentially a barometer of anticipated future activity and production expectations.
Outside of IBC's manufacturing core 2010, we have been very busy on several fronts. First, we successfully closed a $10.35 million financing which was well received by the capital markets with the offering being increased twice. The primary use of proceeds was the expansion and acquisition of Beralcast® Corporation which was completed on March 30, 2010.
Beralcast® Corporation is a Massachusetts based specialty manufacturing business that owns proprietary and patented technology for a castable beryllium aluminum alloy currently used in a wide variety of aerospace and advanced technology applications. We are very excited by the enormous potential of Beralcast® and have already had a number of serious aerospace and military customer inquiries.
IBC has also made significant strides in advancing its Purdue and Texas A&M universities sponsored nuclear fuels research program. Leading this initiative is Jim Malone, formerly vice president of nuclear fuels for Exelon Generation, who joined IBC as vice president of nuclear fuels in April this year. Jim is highly respected in the nuclear fuels sector and brings great experience and the highest level of business and political connections to IBC's program.
Last, I would like to take this opportunity to announce that David Brown, IBC's vice president of marketing, who came to us via our acquisition of Freedom Alloys in 2008, will be retiring from the company. Many of you may have had the pleasure of dealing with David and know that he is very highly regarded in the industry. He provided me with a great deal of guidance in the formative stages of IBC and I would like to offer him my sincerest thanks and wish him and his family all the best.
President and CEO
Casting Call - Beralcast® Leads the Way
IBC is positioned to establish itself as a global leader and a primary source of specialty aluminium beryllium alloys products. In March 2010, we acquired Beralcast® Corporation, a Massachusetts based specialty alloy manufacturing business that owns proprietary and patented technology for a castable beryllium aluminum alloy. Since this acquisition, we have been working hard to develop and capitalize on Beralcast® Corporation's unique products, which are marketed and sold under the trademark name Beralcast®.
Beralcast® alloys are more than three times stiffer than aluminum with 22% less weight and can be precision-cast to simple and complex configurations. Beralcast® is very lightweight and has outstanding physical characteristics including lightness, stiffness and damping. For many applications, product requirements demand lightweight, dimensionally stable, high stiffness and workable materials such as Beralcast®. This material is a proven technology and its advanced properties such as light weight, dimensional stability, stiffness, vibration damping qualities and workability are ideally suited for certain demanding semiconductor manufacturing equipment, computer components and other commercial and aerospace applications and allows for a near-net shape to be cast for maximum manufacturing efficiencies.
Beralcast® Corporation provides IBC with the opportunity to increase the diversity and reach of our specialty alloys business with the quality and recognized capacity of Beralcast®. The Beralcast® production process is proprietary and has not been duplicated by anyone else, giving IBC the edge in providing cost-efficient, quality products to industry operators and customers who are looking to enhance the performance of their products.
The Mission-Critical Beryllium Copper Pitot Tube
For over a decade IBC Freedom Alloys has been supplying high strength/high purity beryllium copper investment casting alloy material utilized to manufacture a mission-critical component onboard all commercial and military aircraft - the pitot tube.
Pitot tubes are performance-critical components in high reliability navigation and instrumentation systems which measure essential flight data such as the aircraft's airspeed, Mach number, altitude and altitude-trend. Pressure-sensing devices onboard the aircraft employ a "pitot tube" to measure flow velocity with extremely high accuracy and performance dependability.
Pitot tubes are typically precision investment cast utilizing beryllium copper to take advantage of the materials outstanding fluidity characteristics which are so important when a flawless precision casting is required. Beryllium copper's physical and mechanical properties are no less important. Beryllium copper's unique combination of non-magnetic, high impact and fatigue strength and excellent corrosion resistance properties are absolutely necessary for such high-reliability flight system components.
The beryllium copper investment casting alloy IBC Freedom Alloys supplies to aerospace sub-contractors that produce pitot tubes is of unusually high purity. Only ultra-pure cathode copper and beryllium input material are utilized to create the alloy. Our proprietary automated semi-continuous casting system insures the beryllium copper ingots exhibit consistently fine grained, uniform micro-structures coupled with high purity, low carbide chemical compositions.
There is no substitute for quality and reliability. IBC is the go-to beryllium copper supplier for this very important aerospace product - the pitot tube.
IBC's Supply Chain - Strengthening Partnerships
Over the past few months IBC has entered into several significant agreements as we continue to align ourselves with respected partners and to expand our product line and high performance alloys globally. Our ultimate objective is to maximize the availability of our products in the global marketplace, and form strong international relationships, in order to best serve our customers.
IBC is now working with both Swissmetal Industries Limited ("Swissmetal") and Albromet Handelsgesellschaft mbH ("Albromet") to increase awareness and distribution channels for our respective products. There is significant potential for all companies as we build increase both European and North American market share while driving demand for IBC's rare metal and beryllium related alloys.
With Swissmetal our focus is to raise brand awareness in Canada for CN8, a high-performance copper nickel tin alloy for technically demanding applications, initially in the aerospace and oil and gas industry. Our partnership with Albromet is hoped to take advantage of the expanding European market for advanced nonferrous and other alloys and the companies will be jointly presenting at the Euromold show in Frankfurt in December.
We are continuing to seek out beneficial opportunities with other strategic partners, including certain distributors in China and India, to maximize our product variety and distribution efficiencies with the aim to make IBC's products and services at the top of every customer's list.
IBC Keeps the Welding Wheels Turning
In an industry that requires precision and consistency, we believe it is essential to deliver the right materials to our customers. IBC values its customers considerably and we are always seeking new and innovative methods to deliver the highest quality products. When a customer is looking for an alternative option or product to enhance the productivity of their business, we are ready to address the needs of the customer first.
Since 2007, IBC Advanced Alloys' Franklin, Indiana operation has been working with TTP Technologies Ltd. ("TTP") to produce welding wheels and spot welding electrodes used for joining sheets in their resistance welding process. TTP, based in Bangalore, India, is one of the largest global manufacturers of industrial radiators used on liquid cooled transformers. In April 2007, TTP approached IBC to assist in improving their seam welding process. IBC's experience in applying forged, made-to-order products, delivered electrodes with a fine grain structure better suited to the application. The welding wheels proved to be a success by increasing plant productivity and lengthening the life of the wheels.
Mr. M. D. Shetty, managing director at TTP, attests to the quality and function of our products. "We are able to obtain quality seam welding without any interruption from our supplier -- IBC Nonferrous. The seam welding wheels they make for us have increased longevity in the product itself and allowed for greater production output at our manufacturing plant. As a result of their high quality forged machined wheels, the defects in seam welding are significantly reduced and the usage period has extended."
IBC Nonferrous is now the sole supplier for TTP for all their welding applications, which includes a high volume of individual parts that they depend on for much larger applications. We are dedicated to provide superior products without delay or disruption to customers all over the world and look forward to providing our services to more customers like TTP Technologies Ltd.