Innovation keeps Eastern Polymer in front
Eastern Polymer Group Plc (EPG), a maker of synthetic rubber and plastic products with customers in sectors ranging from construction to auto parts and packaging, listed on the Stock Exchange of Thailand last December. Chief executive officer Pawat Vitoorapakorn discusses the company’s strategy and outlook.
Please explain the history of EPG.
The company was founded in 1978 by the Vitoorapakorn family and, through in-house research of high-quality insulation rubber, introduced the Aeroflex brand. Throughout the years we have continued to innovate and in 1994 expanded into automotive accessories, specifically bed liners for pickup trucks under the Aeroklas brand.
In 1995, we invested in two joint ventures with Japanese manufacturers — 20% in Tokai Eastern Rubber (Thailand) and 27% in Zeon Advanced Polymix, which produce anti-vibration rubber for the automotive and polymer compound industries. In 2001, we acquired a distressed asset from a local plastic packaging producer and revived the plant to produce high-quality packaging products for global brands under the EPP trademark of our company Eastern Polypack.
Please explain EPG’s business model.
We have three core businesses — Aeroflex, Aeroklas and EPP — and a global distribution network covering more than 100 countries. Aeroflex uses the world’s best-quality elastomeric thermal insulation and is well established globally with the third-largest market share. Its elastomeric, aero-acoustic and aero-roof insulation products are used in the construction materials market. We have six Aeroflex production facilities throughout the world, with two licensing partners as well.
For Aeroklas, we’re recognised as an innovative original-design manufacturer (ODM) by the world’s leading car makers with our patented non-drilled technology used in bed liners, canopies, deck covers, side steps and other accessories. With factories in Thailand and China, we’re the largest manufacturer of pickup truck bed liners in the world.
Finally, with EPP we’re a leading ODM that applies outstanding technology to innovative products including plastic cups, food containers, snack packages and plastic sheets made in Thailand for both modern and traditional trade customers as well as companies such as Yum Yum Foods, Charoen Pokphand, MK Suki, Oishi and McDonald’s.
EPG recently acquired TJM Products Pty Ltd in Australia. Could you explain the reasons for this?
TJM gives us the opportunity to expand our distribution channel for automotive accessories in Australia. It has 43 years of history with 60 brand distributions and 27 licensed stores in Australia. This is a very important outlet and has opened a new opportunity for us, as we’re discovering new products we could make ourselves and introduce throughout the distribution channel. We hope TJM will be another strong performer within the group in the coming years.
How important is innovation and patenting for EPG?
Innovation is the key driver of our business and the sole factor making us the world’s top producer in our field. The scientists in our EPG Innovation Center work continuously to create and improve both new and existing technologies for the benefit of our clients and the environment.
For example, within the next five years car makers will want to decrease the weight of vehicles by another 100-200 kilogrammes. Our existing products have already yielded such positive developments, but others are still needed. For example, new Aeroklas pickup and sport-utility vehicle sidesteps will be composite plastic-based, an innovation that we created.
Including all our subsidiaries, we’ve applied for 620 global patents over the past 21 years and obtained 461, of which more than 100 are still in force and another 100 pending. We have patents in all major markets and are among the top Thai companies holding patents in the US.
What are the biggest risks facing your business?
We have benefited by expanding into multiple revenue streams and having a global customer base helps cushion us against volatility in certain regions of the world. For example, a few years ago when oil prices were high, the Middle East was performing very well, but today that is not the case.
But with Asean members such as the Philippines, Vietnam and Singapore doing well, we’re able to balance our group revenue.
The main safeguard we have is innovation, be it for products or as a company by investing in new processes and technologies to streamline our operations and manufacturing processes.
Where do you see EPG in five years?
We intend to be a truly global company, run by professionals and continuously reinventing products. It is very important for us to remain productive and competitive, not to relax but to continue our improvement, our growth, ensuring the company is stable and all stakeholders are taken care of. EPG will continue to be a creative, innovative organisation.
Source: Bangkok Post