KEY POINTS:
John Hirst
Group Managing Director Nuplex
John Hirst's leadership as group managing director of multinational Nuplex Industries this year saw the Auckland-based resins manufacturer become a billion-dollar revenue business. Following improved access to key European and US markets and expansion in Asia, the challenge in the coming year will be to identify the source of the next wave of growth.
How would you describe 2006 for Nuplex?
There were three principal features of 2006. It was the third very difficult year in a row for petrochemical pricing, which impacted margins. Traditional cycles were around 12 months every seven years. Good progress tidying up the business portfolio to improve future focus and profitability. Positive results from the integration of the ex-Akzo Nobel business and confidence in our ability to maintain growth.
What was you or your company's greatest achievement?
Managing raw material shortages and major cost movements, while still maintaining full supply to customers and acceptable margins, were outstanding achievements for our people in a difficult business environment. I am very proud of them. Also, to receive the confidence of the market in our ability to create long-term value - and the positive impact on our share price - was reassuring.
And the greatest disappointment?
I know that I sound single-minded about this, but three years of need for constant price increases tends to blunt the edge of our sales people who are more used to trying to grow the business, create new opportunities for customers, and introduce innovative approaches to problem solving. They have done a great job, but I know that they look forward to the time, not so far ahead, when cost pressures will come off and they can return to a more positive and entrepreneurial approach to their job.
What do you think 2007 will bring for Nuplex?
The key features of 2007 for Nuplex should be finalisation of the European restructuring programme, commissioning new capacity in Europe and Asia, the integration of the business to be acquired from Huntsman Composites in Australia, closure of the Seven Hills site and readying for sale, substantial progress in turning around loss-making operations and getting ready for the next performance lift.
What will be the major challenges for your company in 2007?
With programmes well under way addressing current issues, the challenge will be to identify the next generation of mid-term and long-term growth opportunities and ensure that we have the people in place to allow this to happen, and then initiate the required processes. We have previously noted that we have further growth objectives in Asia, eastern and southern Europe and the US. Our challenge is to be well advanced towards some of these objectives during 2007.
What do you expect from the economy in 2007 and how will that affect your company?
Nuplex is exposed through its resins business to the world economy. We expect some growth although it will undoubtedly be quite variable across the regions, with Asia still delivering well. In Australasia, we anticipate the situation to be fairly flat with maybe a little more Australian activity and a little less from New Zealand. Overall, we anticipate our global business environment to be neutral to performance.
What was the most interesting business story of 2006?
I much enjoyed meeting up with Don Braid of Freightways and getting an understanding of both his international growth strategy and just how well they were doing with it. The market has responded well to this, and Don is to be congratulated. Terrific to see another NZ company taking on the international scene and being sufficiently flexible to adjust their segment and methodology without losing the essence of what has made them a successful company to date.
Who were your mentors? What did they teach you?
I have had many mentors starting with my father, who taught me the value of hard work, dedication to outcomes, and loyalty. Bill Campbell, our founder, made me understand the importance of ensuring customer profitability and caring for own staff as the pillars of a successful business. Fred Holland, whom I succeeded as managing director, showed the value of operational excellence; and my exposure to the Monsanto organisation during the 1980s, when they had a controlling interest, provided an insight into the value of strategic thinking and business planning.
Where are you going for the holidays?
My wife and I will holiday in Auckland this Christmas period, taking the opportunity to spend time with our new granddaughter, our son, daughter-in-law, my parents, friends and our respective families. There will be time for golf, and I am hoping someone may invite me fishing as well.
What will you be reading?
My reading material on the whole will not be too much of a stress on the mind, but will include Bill Bryson's A Short History of Nearly Everything.
