An in-city success story

Tenax Corp.: This producer of plastic products is expanding its East Baltimore operation, and that means more workers will be hired.

November 24, 2001|By Kristine Henry | Kristine Henry,SUN STAFF

Bucking the recession that has beset most of the manufacturing sector for more than a year, a small East Baltimore firm that produces plastic products by feeding resin through a contraption that looks like a giant pasta maker is moving ahead with a large expansion.

Tenax Corp. makes everything from the orange fencing that surrounds construction sites to the netting that covers holiday turkeys in grocery stores to filtration products that help keep football fields dry.

Its biggest source of revenue is selling drainage products for landfills and Superfund sites so they remain dry, which helps prevent toxins from leaking into the surrounding soil and ground water.

That means much of its revenue is dependent on public works projects, and that is likely to bode well for the firm in the near term.

"Most politicians agree that one critical component to economic stimulus is public sector construction," said Peter Ianniello, executive vice president of Tenax. "The overall economic outlook for public sector construction appears to be favorable, even in light of the Sept. 11 issues and other factors that have impacted our economy."

The Italian-based company expects sales to grow 7.5 percent this year, to $24.5 million - 88 percent more than the $13 million of 1997.

Tenax employs about 90 people at its 60,000-square-foot plant on East Monument Street. That number will grow to 100 - two-thirds of whom will be hourly workers making about $10 an hour - when Tenax completes its expansion, scheduled for January.

The firm now has seven extruders, the pasta-maker-like machines that are each about 8 feet long and produce a total of 25 million pounds of plastic products a year. Tenax is spending about $2.5 million to design and build a 20-foot extruder that will boost capacity by 40 percent.

Tenax received no public assistance for this expansion, although the city provided a $350,000 loan when Tenax built a distribution facility across the street from its plant last year.

The city and state also provided $250,000 in loans to Tenax when the company moved from its Jessup location to Baltimore in 1993. The company wanted to be near public transportation so it could more easily recruit workers.

The privately held Tenax was founded in 1960 in Italy, where it has two plants. Baltimore is its only U.S. manufacturing location.

As its work force grows, Tenax is also expanding into road construction.

One of the keys to making a road last is to keep it as dry as possible. That means not only designing it so rain will run off the surface but also preventing ground water from pushing up into the road; the pressure from vehicles' tires acts as a pump, bringing water toward the surface.

Construction crews typically lay gravel underneath roadways to act as a drain. Tenax has developed a product - which looks like a huge wafer of black licorice sticks welded together - that it says is more effective than gravel.

The same principle is employed in Tenax's products that are used underneath artificial grass at football stadiums - including those at the University of Nebraska and the new home of the Seattle Seahawks. But no one has previously tried it underneath roads.

Tenax's products are being used on an experimental basis by the Maine Department of Transportation, and in more than a dozen other states. The company is in the initial stages of introducing the concept to Maryland officials.

"There have been lots of studies that mention that if you can reduce water from the roadway, you will extend its life span by two to three times," said Scott Hayden, soils research scientist for Maine's DOT.

Hayden said water draining from underneath roadways travels only about a foot a day when gravel is used, but with Tenax's product it travels at a rate of 1,000 feet a day.

The catch, for both Hayden and Tenax, is that the plastic product increases initial costs by about 5 percent.

"That makes a lot of people scream, but you can't look at it in the short term," Hayden said. "You recoup it if you actually look at the life cycle cost 10 or 20 years down the road. Generally, a road lasts 10 or 20 years, but if you can improve the drainage, you can extend that by two or three times."

Road-related products now make up about 5 percent of Tenax's annual revenue. But Ianniello said the company expects triple-digit growth in that sector; gravel's use in roadways is currently a $100 million market.

"We've got a lot of exciting things coming in," Ianniello said.

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