Cereplast's (El Segundo, CA) bio-based plastics will now be available in Malaysia through an exclusive distribution agreement with CRS Technologies Sdn. Bhd (Kuala Lumpur). This move follows the company's entrance into southern China in April when it signed on S&P Sourcing Co. Ltd. out of Hong Kong to distribute its bio-based resins in the region. S&P operates a manufacturing and distribution facility in Shenzhen, called Vulcan Plastics Technology Co. Ltd.
The company said in a release that both deals represent its strategy to engage "strong Asian distribution partners" to help promote the benefits of its bioplastic/compostable resins within key geographic regions globally. Under the agreement, CRS Technologies will use starch-based Cereplast Compostables and starch/standard plastic Hybrids Resins in its manufacturing process for customers throughout Malaysia. A Cereplast representative told PlasticsToday that both China and Malaysia will receive Cereplast materials manufactured in the U.S. and then exported to the respective countries. Simon Huang is the regional director of sales in Asia for Cereplast, spending roughly half the year in the region. Earlier in the quarter, the company reached an agreement with custom compounder and distributor A. Schulman (Akron, OH) to promote its materials in Europe.
Cereplast utilizes starches from corn, wheat, tapioca, and potatoes, as well as Ingeo polylactic acid (PLA) resin from NatureWorks to displace fossil-fuel based chemicals and polymers. Cereplast notes that Malaysia is a net importer of resins from the U.S., which provides 10% of the country's supply.
In its first-quarter earnings statement, Cereplast showed that while sales and gross profits were down slightly, its net loss decreased by 23.2%, as it commenced operations at its new Indiana production facility and shifted from pilot to full production and commercialization. In that March 31 earnings release, Frederic Scheer, founder, chairman, and CEO of Cereplast said, "[Cereplast] made great strides in the first quarter as our results began to reflect the successful execution of our strategy." Scheer noted that from a financial side, Cereplast reduced operating expenses and increased margins in the first quarter, adding that the lower sales were in part impacted by the temporary 60-day closure of its factory as it moved operations to the new production site in Seymour, IN.
In the same release, Scheer said that site will have an increased production capacity of about 80 million lb of bioplastics when operating at full capacity. The facility, covering 110,000 ft2 on a 14-acre lot, has reportedly helped the company increase the number of contracts for its resins from customers in the U.S. and Asia. Through the first three quarters of 2009, Cereplast had gross sales of $2.1 million, compared to $3.4 million for the same time period in 2008. For the full year 2010, Cereplast is forecasting revenue to be in the range of $8 million-$10 million.