June 23, 2022

Black Mass Recycling Technology

BASF to build battery recycling facility in Brandenburg

BASFBatteriesbattery cellsBrandenburgGermanyRecyclingResourcesSchwarzheidesuppliers

BASF will build a plant for recycling black mass from batteries on an industrial scale in Schwarzheide, Brandenburg – where BASF’s pilot recycling plant is also located. Commissioning of the large plant is planned for early 2024.

The annual processing capacity is to be 15,000 tonnes – old electric car batteries and material that does not meet production specifications will be recycled. The latter can come from the immediate vicinity: As is well known, BASF is also building its German factory for cathode materials in Schwarzheide. Scrap and offcuts can therefore be reprocessed directly on site.

In the press release, the company describes the site as “ideal for the development of battery recycling activities”. Not only because of its own production on site, but “because there are many manufacturers of electric cars and cell producers in Central Europe”. The plant is expected to create about 30 jobs. The company does not specify the amount of the investment.

The so-called ‘black mass’ is produced in the first phase of battery recycling. After the mechanical treatment of the battery (i.e. dismantling and crushing), components such as plastics and aluminium can already be filtered out. What remains is the black mass, which contains large quantities of the battery’s active materials – such as lithium, nickel, cobalt and manganese. To separate this mass back into the individual materials (which are then used to produce new cathodes), water and chemicals are used in the hydrometallurgical process.

“With this investment in a commercial scale battery recycling black mass plant, we take the next step to establish the full battery recycling value chain at BASF. This allows us to optimize the end-to-end recycling process and reduce the CO2 footprint,” says Peter Schuhmacher, head of BASF’s Catalysts division. “The closed loop from end-of-life batteries to CAM for new batteries, supports our customers along the entire battery value chain, reduces the dependency from mined raw materials and enables a circular economy.”

The groundbreaking for cathode material production in Schwarzheide took place in November 2020. About a month later, the group confirmed it would also build the recycling pilot plant on site. At the pilot plant, which is scheduled to come on stream this year, BASF aims to optimise operating procedures to achieve higher recovery of lithium, nickel, cobalt and manganese from spent lithium-ion batteries.

https://www.electrive.com/2022/06/21/basf-to-build-battery-recycling-facility-in-brandenburg/

June 23, 2022

Black Mass Recycling Technology

BASF to build battery recycling facility in Brandenburg

BASFBatteriesbattery cellsBrandenburgGermanyRecyclingResourcesSchwarzheidesuppliers

BASF will build a plant for recycling black mass from batteries on an industrial scale in Schwarzheide, Brandenburg – where BASF’s pilot recycling plant is also located. Commissioning of the large plant is planned for early 2024.

The annual processing capacity is to be 15,000 tonnes – old electric car batteries and material that does not meet production specifications will be recycled. The latter can come from the immediate vicinity: As is well known, BASF is also building its German factory for cathode materials in Schwarzheide. Scrap and offcuts can therefore be reprocessed directly on site.

In the press release, the company describes the site as “ideal for the development of battery recycling activities”. Not only because of its own production on site, but “because there are many manufacturers of electric cars and cell producers in Central Europe”. The plant is expected to create about 30 jobs. The company does not specify the amount of the investment.

The so-called ‘black mass’ is produced in the first phase of battery recycling. After the mechanical treatment of the battery (i.e. dismantling and crushing), components such as plastics and aluminium can already be filtered out. What remains is the black mass, which contains large quantities of the battery’s active materials – such as lithium, nickel, cobalt and manganese. To separate this mass back into the individual materials (which are then used to produce new cathodes), water and chemicals are used in the hydrometallurgical process.

“With this investment in a commercial scale battery recycling black mass plant, we take the next step to establish the full battery recycling value chain at BASF. This allows us to optimize the end-to-end recycling process and reduce the CO2 footprint,” says Peter Schuhmacher, head of BASF’s Catalysts division. “The closed loop from end-of-life batteries to CAM for new batteries, supports our customers along the entire battery value chain, reduces the dependency from mined raw materials and enables a circular economy.”

The groundbreaking for cathode material production in Schwarzheide took place in November 2020. About a month later, the group confirmed it would also build the recycling pilot plant on site. At the pilot plant, which is scheduled to come on stream this year, BASF aims to optimise operating procedures to achieve higher recovery of lithium, nickel, cobalt and manganese from spent lithium-ion batteries.

https://www.electrive.com/2022/06/21/basf-to-build-battery-recycling-facility-in-brandenburg/

June 23, 2022

Positive Sentiment

No economic ‘hurricane’ on horizon, XPO executives say

Demand remains solid, though supply problems hold back LTL capacity, executives tell investor roadshows

Mark SolomonWednesday, June 22, 2022 5 minutes read

Listen to this article 0:00 / 7:30 BeyondWords

Top XPO Logistics Inc. executives have been telling investors over the past few weeks that they don’t share concerns that an economic “hurricane” is about to hit the U.S., saying they haven’t seen a dramatic decline in demand for the company’s services.

The XPO (NYSE: XPO) C-suite, led by Chairman and CEO Brad Jacobs, has made the rounds of investor meetings through May and June to discuss macro conditions, industry trends and the company’s competitive position in its two main businesses: LTL and truck brokerage. XPO synthesized the questions and answers from the meetings into a 19-page report that was released earlier this month. None of the questioners or respondents were identified, though in one or two instances it is clear that Jacobs is the executive who is answering.

In one of the sessions, an XPO executive was asked why after spending four years acquiring and integrating 18 companies, it is selling or spinning off everything except its North American LTL business. The executive responded that XPO had “created a stock that relatively few investors were interested in” because it was a complex creature with many moving parts. 

“We were a really great company [but] with a low multiple, because the stock market wasn’t in love with us,” the executive said.

To earn Wall Street’s love, XPO began to shed virtually all of its assets, starting with its contract logistics business, now known as GXO Logistics Inc., (NYSE: GXO) which was spun off last summer. The company sold its intermodal business in March and has put its freight forwarding business up for sale. It will spin off its brokerage, final-mile and managed transportation operations by the end of 2021. It also plans at some point to sell or publicly list its European business.

It hasn’t helped much up to now. XPO shares, which traded at near $91 a share in mid-August, closed Wednesday at $45.70. Analysts, for their part, remain upbeat on the shares, with 12-month price targets in some cases of well over $100 a share. XPO estimates that its shares are trading at a low valuation of less than seven times earnings before interest, taxes, depreciation and amortization, the bottom-line metric favored by Jacobs.

One challenge for XPO is convincing investors it can reduce its net debt — or leverage — to levels of around one times EBITDA. XPO has reduced its leverage ratio to two times EBITDA from 2.7 times EBITDA last year. Still, the current ratio remains too high to attract a wide swath of institutional money, an executive said. 

“We have a list of hundreds of institutions that own [shares of] our competition or similar companies but don’t own us,” the executive said. Of those, more than half won’t buy XPO shares because of its current debt position, the executive said. 

“We think there are roughly 500 institutions that could open up once we [bring] the leverage down,” the executive said.

Next LTL phase

XPO executives said they are about to embark on the “next phase” of the company’s LTL strategy, which is to dramatically grow the unit’s revenue while maintaining healthy margins. XPO has focused on cost-cutting-driven margin expansion since it entered the LTL business in 2015 by acquiring Con-way Inc. for $3 billion. To an extent, however, the company sacrificed top-line growth by not investing heavily in the business.

“We went into LTL with the plan to put 3% to 4% of revenue” into capital spending and still achieve a robust multiple, one executive said. What XPO discovered was that some competitors put as much as 15% of their revenue into capex, and came away with twice the valuation multiples, the executive said. 

“The market wants to see growth, not just margin expansion,” the executive said. “We’re going to invest in the fleet and network. We’re going to substantially increase our capex, and we’re going to grow the top line in addition to growing margin.”

Part of that investment will be directed at building more truck trailers in-house and adding more drivers, steps that XPO believes will reduce its overreliance on expensive third-party transportation known as “purchased transportation.” Until the pandemic, about 25% of XPO’s line-haul miles were operated by third-party providers, down from 35% in 2015. “The goal is to bring that percentage down to closer to 5% over time,” an executive said. 

XPO spent $136 million on purchased LTL transportation in the first quarter, up 44% from the 2021 quarter. Supply chain problems, notably with a continued dearth of microchips embedded in vehicles, are constraining in-house capacity utilization, an executive said. “We could take three times as many tractors as we’re currently getting” from truck manufacturers, one of the executives said.

Despite the many investments it will make that will drive up costs, XPO is on track to bring its operating ratio — the ratio of revenues to expenses — below 80% at some point. “The investments don’t dilute a path to that,” said one of the executives. Adjusted operating ratio, which began the year in the high 80% range, is expected to settle at a full-year average of 83.3%.

Brokerage in high cotton

XPO’s truck brokerage business, which has posted blowout quarters for the past 18 months, is in a different situation. The company is leveraging massive upfront investments in brokerage technology to source or cover about three-quarters of its loads digitally, one of the executives said. That level should rise to 95% in a few years, according to the executives. Improved efficiencies, and a strong tailwind in the spot or noncontract market, have made brokerage a high-margin business for XPO.

The company expects additional margin improvements even as spot and contract rates decline, an executive said. Most customers want 12-month brokerage contracts so they can be insulated from sudden cost increases, the executive said.

“Shippers don’t want to be burned again by costs going up and up,” the executive said. “Even though the spot market is softer now, they don’t know when it’s going to be firm. China’s opening up. Maybe three months from now, there could be a tight market again.”

XPO executives said that the company’s customers in general are not increasing their inventory levels in response to potential supply chain disruptions, but that they want the right levels of the right products in the proper locations. “They’re not going back to the time” of having two huge bicoastal distribution centers and a third in the Midwest, an executive said. Instead, they’re moving toward “right-sized” distribution centers positioned closer to the end customer. 

Consumers are unlikely to unlearn their “want-it-now” behavior, the executive said. As a result, supply chains will become shorter and faster, and be supported by more fulfillment and distribution centers than in the past.

The pandemic-related factory lockdowns in China, and the specter of them soon opening up, is uppermost in LTL customers’ minds, according to an XPO executive. North American industrial customers, an LTL carrier’s bread and butter, have been “choked by the lack of goods coming out of China,” the executive said, adding that it was “surprising” to see how “pervasive” this issue is with XPO’s customers.

June 23, 2022

Positive Sentiment

No economic ‘hurricane’ on horizon, XPO executives say

Demand remains solid, though supply problems hold back LTL capacity, executives tell investor roadshows

Mark SolomonWednesday, June 22, 2022 5 minutes read

Listen to this article 0:00 / 7:30 BeyondWords

Top XPO Logistics Inc. executives have been telling investors over the past few weeks that they don’t share concerns that an economic “hurricane” is about to hit the U.S., saying they haven’t seen a dramatic decline in demand for the company’s services.

The XPO (NYSE: XPO) C-suite, led by Chairman and CEO Brad Jacobs, has made the rounds of investor meetings through May and June to discuss macro conditions, industry trends and the company’s competitive position in its two main businesses: LTL and truck brokerage. XPO synthesized the questions and answers from the meetings into a 19-page report that was released earlier this month. None of the questioners or respondents were identified, though in one or two instances it is clear that Jacobs is the executive who is answering.

In one of the sessions, an XPO executive was asked why after spending four years acquiring and integrating 18 companies, it is selling or spinning off everything except its North American LTL business. The executive responded that XPO had “created a stock that relatively few investors were interested in” because it was a complex creature with many moving parts. 

“We were a really great company [but] with a low multiple, because the stock market wasn’t in love with us,” the executive said.

To earn Wall Street’s love, XPO began to shed virtually all of its assets, starting with its contract logistics business, now known as GXO Logistics Inc., (NYSE: GXO) which was spun off last summer. The company sold its intermodal business in March and has put its freight forwarding business up for sale. It will spin off its brokerage, final-mile and managed transportation operations by the end of 2021. It also plans at some point to sell or publicly list its European business.

It hasn’t helped much up to now. XPO shares, which traded at near $91 a share in mid-August, closed Wednesday at $45.70. Analysts, for their part, remain upbeat on the shares, with 12-month price targets in some cases of well over $100 a share. XPO estimates that its shares are trading at a low valuation of less than seven times earnings before interest, taxes, depreciation and amortization, the bottom-line metric favored by Jacobs.

One challenge for XPO is convincing investors it can reduce its net debt — or leverage — to levels of around one times EBITDA. XPO has reduced its leverage ratio to two times EBITDA from 2.7 times EBITDA last year. Still, the current ratio remains too high to attract a wide swath of institutional money, an executive said. 

“We have a list of hundreds of institutions that own [shares of] our competition or similar companies but don’t own us,” the executive said. Of those, more than half won’t buy XPO shares because of its current debt position, the executive said. 

“We think there are roughly 500 institutions that could open up once we [bring] the leverage down,” the executive said.

Next LTL phase

XPO executives said they are about to embark on the “next phase” of the company’s LTL strategy, which is to dramatically grow the unit’s revenue while maintaining healthy margins. XPO has focused on cost-cutting-driven margin expansion since it entered the LTL business in 2015 by acquiring Con-way Inc. for $3 billion. To an extent, however, the company sacrificed top-line growth by not investing heavily in the business.

“We went into LTL with the plan to put 3% to 4% of revenue” into capital spending and still achieve a robust multiple, one executive said. What XPO discovered was that some competitors put as much as 15% of their revenue into capex, and came away with twice the valuation multiples, the executive said. 

“The market wants to see growth, not just margin expansion,” the executive said. “We’re going to invest in the fleet and network. We’re going to substantially increase our capex, and we’re going to grow the top line in addition to growing margin.”

Part of that investment will be directed at building more truck trailers in-house and adding more drivers, steps that XPO believes will reduce its overreliance on expensive third-party transportation known as “purchased transportation.” Until the pandemic, about 25% of XPO’s line-haul miles were operated by third-party providers, down from 35% in 2015. “The goal is to bring that percentage down to closer to 5% over time,” an executive said. 

XPO spent $136 million on purchased LTL transportation in the first quarter, up 44% from the 2021 quarter. Supply chain problems, notably with a continued dearth of microchips embedded in vehicles, are constraining in-house capacity utilization, an executive said. “We could take three times as many tractors as we’re currently getting” from truck manufacturers, one of the executives said.

Despite the many investments it will make that will drive up costs, XPO is on track to bring its operating ratio — the ratio of revenues to expenses — below 80% at some point. “The investments don’t dilute a path to that,” said one of the executives. Adjusted operating ratio, which began the year in the high 80% range, is expected to settle at a full-year average of 83.3%.

Brokerage in high cotton

XPO’s truck brokerage business, which has posted blowout quarters for the past 18 months, is in a different situation. The company is leveraging massive upfront investments in brokerage technology to source or cover about three-quarters of its loads digitally, one of the executives said. That level should rise to 95% in a few years, according to the executives. Improved efficiencies, and a strong tailwind in the spot or noncontract market, have made brokerage a high-margin business for XPO.

The company expects additional margin improvements even as spot and contract rates decline, an executive said. Most customers want 12-month brokerage contracts so they can be insulated from sudden cost increases, the executive said.

“Shippers don’t want to be burned again by costs going up and up,” the executive said. “Even though the spot market is softer now, they don’t know when it’s going to be firm. China’s opening up. Maybe three months from now, there could be a tight market again.”

XPO executives said that the company’s customers in general are not increasing their inventory levels in response to potential supply chain disruptions, but that they want the right levels of the right products in the proper locations. “They’re not going back to the time” of having two huge bicoastal distribution centers and a third in the Midwest, an executive said. Instead, they’re moving toward “right-sized” distribution centers positioned closer to the end customer. 

Consumers are unlikely to unlearn their “want-it-now” behavior, the executive said. As a result, supply chains will become shorter and faster, and be supported by more fulfillment and distribution centers than in the past.

The pandemic-related factory lockdowns in China, and the specter of them soon opening up, is uppermost in LTL customers’ minds, according to an XPO executive. North American industrial customers, an LTL carrier’s bread and butter, have been “choked by the lack of goods coming out of China,” the executive said, adding that it was “surprising” to see how “pervasive” this issue is with XPO’s customers.

June 22, 2022

Even More M&A

LP Building Solutions and Pacific Woodtech Enter Acquisition Agreement for LP’s Engineered Wood Products Business and SolidStart® Brand

Tue, June 21, 2022 at 6:00 PM·3 min readIn this article:

NASHVILLE, Tenn., June 21, 2022 /CNW/ — LP Building Solutions (LP) (NYSE: LPX) today announced an agreement with Pacific Woodtech to acquire LP’s Engineered Wood Products (EWP) business for $210 million. The acquisition includes LP’s laminated veneer lumber and I-joist manufacturing facilities in Wilmington, North Carolina; Red Bluff, California; and Golden, British Columbia, Canada, associated timber license assets, and the SolidStart^® brand. The completion of this transaction is subject to customary closing conditions and regulatory reviews and is expected to occur in the third quarter of 2022.

Pacific Woodtech’s acquisition of LP’s EWP business marks another important step in our ongoing strategic transformation

“We believe that Pacific Woodtech is well positioned to invest in and grow the SolidStart brand, and its acquisition of LP’s EWP business marks another important step in LP’s ongoing strategic transformation,” said LP Chair and Chief Executive Officer Brad Southern. “We will work with Pacific Woodtech to ensure a smooth transition for our EWP employees, customers, and suppliers. I want to express my sincere thanks to the entire EWP team for their patience and professionalism throughout this process. I wish them all the best moving forward.”

“Adding the EWP facilities in Golden, Wilmington, and Red Bluff to Pacific Woodtech’s existing EWP business propels our company to new growth,” said Pacific Woodtech President and Chief Executive Officer Jim Enright. “We aim to drive positive change at the cutting edge of engineered wood products, and this acquisition will provide a more streamlined and focused EWP resource for the industry. We are committed to making this a seamless transition, one that allows for the retention and care of current employees, clients, and suppliers and strengthens our position as a leading force in the EWP market going forward.”

LP’s financial adviser is UBS Investment Bank. LP’s legal advisers are Troutman Pepper and Fasken Martineau DuMoulin LLP.

About LP Building Solutions

As a leader in high-performance building solutions, Louisiana-Pacific Corporation (LP Building Solutions, NYSE: LPX) manufactures engineered wood building products that meet the demands of builders, remodelers, and homeowners worldwide. LP’s extensive offerings include innovative and dependable building products and accessories, such as siding solutions (LP^® SmartSide^® Trim & Siding, LP^® SmartSide^® ExpertFinish^® Trim & Siding, LP BuilderSeries^® Lap Siding, and LP^® Outdoor Building Solutions^®), LP Structural Solutions (LP^® TechShield^® Radiant Barrier, LP WeatherLogic^® Air & Water Barrier, LP Legacy^® Premium Sub-Flooring, and LP^® FlameBlock^® Fire-Rated Sheathing, LP NovaCore™ Thermal Insulated Sheathing, and more), LP^® TopNotch^® Sub-Flooring, and oriented strand board (OSB). In addition to product solutions, LP provides industry-leading customer service and warranties. Since its founding in 1972, LP has been Building a Better World^™ by helping customers construct beautiful, durable homes while our shareholders build lasting value. Headquartered in Nashville, Tennessee, LP operates 25 plants across the U.S., Canada, Chile, and Brazil. For more information, visit LPCorp.com.

https://finance.yahoo.com/news/lp-building-solutions-pacific-woodtech-220000347.html