Could you give us an overview of Tremco CPG’s portfolio and portfolio strategy?

Tremco Construction Products Group (CPG) is an amalgamation of leading construction industry brands that weatherproof, protect, and provide longevity to the built environment. Our product segments include, but are not limited to, above- and below-grade waterproofing, glazing & façade sealants, resinous floor coatings, cementitious grouts & admixtures, and passive fire protection solutions. The group is headquartered in Ohio, USA, and belongs to the NYSE-listed RPM International Inc. (RPM), a US$6.7 billion multinational company also based in Ohio.

Our entrance into the Southeast Asia market began in 1996 with “Flowcrete Asia,” which focused predominantly on supplying resinous flooring materials for large infrastructure projects such as the Kuala Lumpur International Airport. In tandem, other CPG brands had also grown a presence until finally, in 2019, all brands were amalgamated into a unified multiple-brand company offering complete solutions for the six sides of the building: the roof, basement, and the four walls.

Tremco CPG is investing in a new factory in Malaysia. What is motivating this investment?

We have three factories in APAC: one is in Malaysia, serving mostly Southeast Asia. The second one is in Korea, and the third is in the suburbs of Sydney, Australia. We are building a new factory in Kuala Lumpur, which we expect to be fully operational by June 2025. The new plant will expand our capacity output by 60%, allowing us to support further growth in Southeast Asia. Our vision is not limited to this region: From Malaysia, we already supply into South America, the Middle East, Australia, and New Zealand.

Can you delve into the macro trends that are driving further growth for Tremco CPG in Southeast Asia?

Before the pandemic, countries like Vietnam scored double-digit growth year after year. Meanwhile, Indonesia differentiates itself through its immense domestic market, while Malaysia and the Philippines have been drawing more attention from European and US investors. Philippines was ranked second in the world for the construction of new buildings of 40 stories or higher. Over the past 10 years, China has invested considerably in infrastructure projects like commercial and residential buildings, highways, high-speed trains, seaports, and airports, which we expect to continue into the next decade. Currently, Southeast Asia ranks fourth in terms of construction growth, coming after China, the US, and Europe, but it is expected that, by 2030, Southeast Asia will overtake Europe.

How has the introduction of new construction regulations shifted demand in the region?

In this part of the world, owners want to build faster, higher, and stronger, while staying within budget; to do this well, many countries are working to introduce regulations, often by taking the example of Singapore, which has the most advanced construction standards. For example, our Nullifire SC902 product, used as intumescent coatings for steel structures (for fire protection) had been competing against local competitors in Thailand. We worked with the Thai government to explain the importance of testing and third-party certification to guarantee safety and have since obtained our first project to supply fire protection for the MRT Orange Line in Bangkok. Unfortunately, tragedies like the Grenfell Tower fire in 2017 in the UK have proven the importance of having a well-protected structure to give people time to evacuate in the case of a fire. Every country in Southeast Asia is now looking at new codes for fire protection, and Tremco CPG is sitting at those tables, educating the market and regulators on safety and certification.

How has Tremco CPG mitigated supply chain disruptions over the past year?

Our experience in the market has helped us protect the business from supply chain disruptions, for instance by sourcing raw materials from multiple suppliers and always ensuring alternative options, but we still face challenges around sourcing certain products that are dominated by a single supplier; thankfully, over 90% of our raw materials are procured regionally, with only 10% coming from the US or Europe. That 10% has become even trickier due to the consolidation in the shipping industry, which can prolong shipping time from the US to Malaysia. We plan our production very carefully by ordering several months in advance.

What are your top priorities for 2023-2024?

Our chief priority is to see the new plant up and running, and, once we are in production, to stabilize the quality of the products coming out. Finally, we want to optimize the formulation to provide maximum performance for our customers across the region.