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Plastics Manufacturers Posting Sales, Profit Margin Gains

March 12, 2015, 07:00 AM
Filed Under: Plastics

U.S. plastics product manufacturers, key suppliers to auto and aerospace industries, construction and retailing, recently wrapped up their fifth year in a row of increased sales, according to new data from Sageworks, a financial information company.

Profitability has also strengthened as the industry benefits from a growing economy, increasing automation and “reshoring” trends.

Preliminary estimates from Sageworks’ analysis of statements filed in 2014 show that privately held companies in the industry, on average, increased sales by about 4 percent, on top of roughly 8 percent growth in each of the previous two years. Plastics product manufacturers in 2011 and 2012 had experienced double-digit growth as manufacturing in general led the U.S. economy out of the recession.

“A lot of things have plastic in them, so it’s an important industry,” said Sageworks analyst Kevin Abbas. 

Abbas said data on plastics manufacturers’ results in 2014 continue to flow into Sageworks’ database, so it’s too early to determine whether any slowdown in plastics product manufacturing sales was material. However, he noted growth rates for 2014 appear to be lower than rates for manufacturing in general, and he said that many industries with consecutive years of strong revenue growth have a tough time sustaining those elevated growth rates.

“The U.S. exports a lot of plastic,” said Abbas.  “While the U.S. economy is strong, concerns about the general global economy might provide insight into why our initial estimates indicate a slower rate of growth for plastic manufacturers,” Abbas said.

To read the full release featuring additional commentary and graphs, click here.

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