Solid Surface & Other Cast Polymers

INDUSTRY MARKET RESEARCH FOR BUSINESS LEADERS, STRATEGISTS, DECISION MAKERS CLICK TO VIEW

Table of Contents 2

List of Tables & Charts 3

Study Overview 4

Sample Text, Table & Chart 5

Sample Profile, Table & Forecast 6

Order Form 7

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Solid Surface & Other Cast Polymers

US Industry Study with Forecasts to 2010 & 2015

Study #2069 | July 2006 | $4300 | 269 pages

The Freedonia Group 767 Beta Drive www.freedoniagroup.com Cleveland, OH • 44143-2326 • USA Toll Free US Tel: 800.927.5900 or +1 440.684.9600 Fax: +1 440.646.0484 E-mail: [email protected] Study #2069 July 2006 Solid Surface & Other Cast Polymers $4300 269 Pages US Industry Study with Forecasts to 2010 & 2015 Table of Contents

Executive Summary Acrylic...... 77 INDUSTRY STRUCTURE Polyester & Polyester/Acrylic Blends..... 80 General...... 187 Market Share...... 83 Market EnvironmenT Industry Composition...... 188 Engineered Stone...... 88 Market Share...... 192 General...... 4 Characteristics...... 92 Competitive Strategies...... 197 Macroeconomic Trends...... 4 Types...... 94 Research & Development...... 201 Consumer Spending Trends...... 7 Quartz...... 94 Marketing...... 203 Demographic Trends...... 9 Others...... 97 Distribution...... 206 Population...... 10 Market Share...... 100 Acquisitions & Divestitures...... 209 Households...... 11 Cultured Stone...... 104 Cooperative Agreements...... 210 Building Construction...... 12 Cultured Marble...... 108 Residential Building Construction...... 13 Other Cultured Stone...... 110 Housing Units...... 16 Company Profiles Housing Stock...... 19 Baker (Craig) Marble...... 214 Improvements & Repairs...... 21 END USES BLANCO GmbH & Company KG...... 215 Nonresidential Building Construction...... 22 General...... 113 CaesarStone...... 216 Nonresidential Stock...... 24 Countertops...... 115 CAMBRIA...... 218 Nonresidential Improvements Residential...... 116 CCM Enterprises...... 219 & Repairs...... 27 New Construction...... 120 Central Marble Products...... 220 Environmental & Other Considerations...... 28 Remodeling...... 122 Cheil Industries...... 221 Pricing Trends...... 31 Nonresidential...... 125 Chemcore Industries...... 222 Solid Surface...... 32 Office & Commercial...... 128 Cosentino SA...... 223 Engineered Stone...... 34 Industrial...... 130 DuPont (EI) de Nemours...... 226 Cultured Stone...... 36 Institutional & Other...... 131 EOS Surfaces...... 228 Competitive Materials...... 37 Other Building Applications...... 134 Fama Industries...... 228 Laminates...... 37 Kitchen & Bathroom Sinks...... 136 Florenata Solid Surfaces...... 230 Natural Stone...... 38 Kitchen Sinks...... 139 Formica Corporation...... 231 Others...... 40 Bathroom Sinks...... 140 Halstead International...... 232 World Market...... 40 Other Bathroom Applications...... 141 Hanwha Group...... 234 Western Europe...... 41 All Other Building Applications...... 143 Illinois Tool Works...... 236 Asia/Pacific...... 42 Other...... 146 L&M Cultured Marble...... 238 Rest of World...... 44 Lehigh Cultured Marble...... 239 Foreign Trade...... 45 REGIONAL MARKETS LG Chem Limited...... 240 Solid Surface...... 47 General...... 149 Lippert Corporation...... 242 Engineered Stone...... 49 Regional Demographic & Economic Trends.. 150 Majestic Marble & Glass...... 243 Cultured Stone...... 50 Population Patterns...... 151 Marbled Elegance...... 244 Economic Outlook...... 153 Marmol Compac SA...... 245 MATERIALS Construction Activity...... 154 Meganite Incorporated...... 246 Mitsubishi Corporation...... 248 General...... 51 Housing Trends...... 156 Pioneer Plastics...... 250 Marble & Related Materials...... 53 Regional Demand for Cast Polymers...... 159 Quartzitec...... 251 Resins...... 55 Northeast...... 163 Royal Stone Industries...... 252 Acrylic...... 57 New England...... 165 Santa Margherita SpA...... 254 Polyester...... 58 Middle Atlantic...... 166 Swan Corporation...... 256 Alumina Trihydrate...... 60 Midwest...... 168 Syn-Mar Products...... 257 Quartz & Related Materials...... 62 East North Central...... 170 Technistone AS...... 258 Other Materials...... 64 West North Central...... 171 South...... 172 Tiffany Marble...... 260 South Atlantic...... 175 Tower Industries...... 260 PRODUCTS East South Central...... 177 Transolid Incorporated...... 262 General...... 67 West South Central...... 178 United States Marble...... 263 Solid Surface...... 72 West...... 180 Venetian Marble...... 264 Characteristics...... 75 Mountain...... 183 Additional Companies...... 265 Types...... 77 Pacific...... 185

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List of Tables & Charts

Executive Summary PRODUCTS 7 Office & Commercial Countertop 1 Summary Table...... 3 1 Cast Polymer Supply & Demand Demand for Cast Polymers...... 130 by Product...... 70 8 Industrial Countertop Demand Market EnvironmenT Cht Cast Polymer Supply & Demand for Cast Polymers...... 131 1 Macroeconomic Indicators...... 7 by Product, 2005...... 71 9 Institutional & Other 2 Personal Income & Expenditures.... 9 2 Solid Surface Material Demand..... 74 Nonresidential Countertop 3 Demographic Indicators...... 10 3 Acrylic-Based Solid Surface Demand for Cast Polymers...... 134 4 Building Construction Demand...... 80 10 Other Building Applications Expenditures...... 13 4 Polyester-Based & Blended Demand for Cast Polymers...... 135 5 Residential Building Construction Solid Surface Demand...... 83 11 Kitchen & Bathroom Sink Expenditures...... 16 Cht Solid Surface Material Demand for Cast Polymers...... 139 6 Housing Environment...... 19 Market Share by Company, 12 Other Bathroom Applications 7 Housing Stock...... 20 2005...... 84 Demand for Cast Polymers...... 143 Cht Year of Construction Stock, 5 Engineered Stone Demand...... 91 13 All Other Building Applications 2005...... 20 6 Quartz Engineered Stone Demand for Cast Polymers...... 146 8 Residential Improvement & Demand...... 97 14 Other End Uses Demand Repair Expenditures...... 22 7 Other Engineered Stone for Cast Polymers...... 148 9 Nonresidential Building Demand...... 99 Construction Expenditures...... 24 Cht Engineered Stone Materials REGIONAL MARKETS 10 Nonresidential Building Stock...... 27 Market Share by Company, 1 Resident Population & 11 Nonresidential Improvement & 2005...... 100 Households by Region...... 152 Repair Expenditures...... 28 8 Cultured Stone Demand...... 108 2 Regional Gross Domestic 12 Cast Polymer Pricing...... 32 9 Cultured Marble Demand...... 110 Product...... 154 13 Foreign Trade in Cast Polymers..... 47 10 Other Cultured Stone Demand.....112 3 Regional Construction Expenditures...... 156 MATERIALS END USES 4 Regional Housing Sales, 1 Raw Material Demand 1 Cast Polymer Demand New Units & Stock...... 159 in Cast Polymers...... 52 by End Use...... 114 5 Cast Polymer Demand Cht Raw Material Demand Cht Cast Polymer Demand by Region...... 162 in Cast Polymers, 2005...... 52 by End Use, 2005...... 114 Cht Cast Polymer Demand 2 Marble & Related Material 2 Countertop Demand by Region, 2005...... 162 Demand in Cast Polymers...... 55 for Cast Polymers by Market.....116 6 Northeast Cast Polymer Demand..165 3 Resin Demand in Cast Polymers.... 56 3 Residential Countertop Demand 7 Midwest Cast Polymer Demand....170 Cht Resin Demand in Cast Polymers.... 56 for Cast Polymers...... 119 8 South Cast Polymer Demand...... 175 4 Alumina Trihydrate Demand 4 New Construction Residential 9 West Cast Polymer Demand...... 183 in Cast Polymers...... 62 Countertop Demand 5 Quartz & Related Material for Cast Polymers...... 122 INDUSTRY STRUCTURE Demand in Cast Polymers...... 64 5 Remodeling Residential 1 US Cast Polymer Sales 6 Other Materials Demand Countertop Demand by Company, 2005...... 191 in Cast Polymers...... 66 for Cast Polymers...... 125 Cht US Cast Polymer Market Share 6 Nonresidential Countertop by Company, 2005...... 193 Demand for Cast Polymers 2 Selected Cooperative by Market...... 128 Agreements...... 212

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Among the major cast polymer types, demand for engineered stone (available in quartz or marble) is expected to register strong growth of 8.8 percent per year to 70 million square feet in 2010.

US demand to grow 4.1% Countertops US Cast Polymer Demand, 2005 annually through 2010 80% (196 million square feet) Demand for cast polymer materials in the US is forecast to advance 4.1 percent per year to 239 million square feet in 2010. Gains will be driven by the increasing use of cast polymers in nonresidential countertops, a relatively low penetration market where construction spending is expected to rebound dramatically and where cast polymers benefit from a number of performance advantages. Such advantages include low maintenance requirements and non- porous surfaces with few or no seams to either disrupt the look of the surface Other Building Surfaces or catch dirt particles. Even in residen- 18% photo courtesy of Kromark tial countertops, the dominant but more All Other End Uses 2% developed end use, cast polymers will continue to gain market share at the ex- pense of many other materials because expansion of distribution networks and Nonresidential market, of those advantages, as well as their growing consumer awareness, as well vast array of color and surface texture as advantages such as excellent scratch less established uses options. and stain resistance, and an appearance to show strong gains that closely resembles natural stone. Although the residential countertop Whereas the bulk of cast polymers in the Engineered quartz, marble market accounted for more than 65 US are supplied by domestic manufac- to exhibit strong growth percent of cast polymer material demand turers, in the engineered stone segment, in 2005, the industry continues to search Demand for engineered stone (available more than two-thirds of demand is com- for and develop additional applications. in quartz or marble) is expected to regis- prised of imports. Strong gains are projected in the non- ter strong growth of 8.8 percent per year residential market, where penetration to 70 million square feet in 2010. Engi- Solid surface materials will continue to remains relatively low, as well as for neered stone, especially quartz, is still a account for the largest share of cast other less established end uses such as relatively new material in the US market, polymer volume sales with 43 percent shower pans, wet walls and bath acces- but will account for nearly 30 percent of in 2010 and will record respectable sories. Other cast polymer applications cast polymer sales in 2010, surpassing increases in demand. Despite cost ad- include sinks, bathtubs, flooring, window cultured stone to be the second largest vantages, demand for cultured stone will sills, architectural embellishments, furni- cast polymer product segment. Gains be modest because of competition from ture, lighting fixtures and drawer pulls. will continue to benefit from ongoing other surfacing products.

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Sample Text, Table & Chart TABLE VI-5

CAST POLYMER DEMAND BY REGION (million square feet)

Item 1995 2000 2005 2010 2015 end uses Construction Expend (bil 2000$) 657.8 835.2 891.1 980.0 1085.0 Countertops sq ft cast polymer/000$ construction 0.11 0.14 0.22 0.24 0.28 Demand for cast polymer materials in the countertop market is forecast to increase 4.3 percent per year to 195 million square feet Castin Polymer Demand 75.6 117.1sam 195.5ple 239.0 301.0 2010. This rate, while still healthy, is a significant deceleration from Northeast 14.9 22.6 37.5 44.7 54.8 that achieved betweens am2000 andple 2005, a period notable for record levels Midwest 17.7 26.5tab 42.2le 50.9 63.2 of residential construction activity and rising popularity of durable andSouth 26.2 40.2 67.9 83.6 106.5 renewable cast polymerte materials,xt such as solid surface and engineered West 1 6.8 27.8 47.9 59.8 76.5 stone, in countertops. Going forward, gains will be driven in part by the falling prices of solid surface and engineered stone materials, which make them more affordable to a broader potential customer base and cost-effective in a greater variety of applications. Additionally, advances in cast polymer demand will be propelled by increasing consumer awareness of engineered stone materials, a product which is relatively new to the US market but which has seen rapid growth in the mid- to high-end segment of the residential countertop market. Gains will also benefit from the increasing penetration of cast polymer surfacing into various nonresidential countertop applications as end users shift to lower maintenance and more durable surface materials. Countertops is the dominant market for all three types of cast polymer materials, accounting for 81 percent of total demand in 2005.

In 2005, the residential segment accounted for the largest share of cast polymer sales to the countertop market with 82 percent. The domi- nance of the residential segment is primarily due to the fact that these materials are generally considered moderate to high-end surfaces that have been slower to penetrate more price sensitive nonresidential applications. Additionally, the residential countertop market is the market CHART VII-1 where most cast polymer materials first gained significant penetration. It is an application where consumers are most aware of the aesthetic andUS CAST POLYMER MARKET SHARE BY COMPANY, 2005 performance advantages of these materials. However, the nonresidential (196 million square feet) market, which is less mature, is projected to see more rapid annualOt hergainss through 2010, benefitting from a projected rebound in real nonresidential48%

construction expenditures over the same period. 11% Cosentino

3% Formica

DuPont 25%

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Sample Profile, TABLE IV-2 Table & Forecast SOLID SURFACE MATERIAL DEMAND

Item 1995 2000 2005 2010 2015

Building Construct Expend (bil $) 451 686 951 1174 1514 $ solid surface/000$ construction 0.79 0.79 0.68 0.60 0.52

Solid Surface Demand (mil $) 355 545 645 700 790 Acrylic-Based 314 474 568 620 703 Polyester-Based & Blends 41 71 77 80 87 sample $/sq ft 9.10 8.26 7.33 6.80 6.20 table Solid Surface Demand (mil sq ft) 39 66 88 103 127 Acrylic-Based 33 56 75 89 110 COMPANY PROFILES Polyester-Based & Blends 6 10 13 14 17

+ net exports 5.5 9.5 2.0 10.0 12.0 CCM Enterprises Solid Surface Shipments (mil sq ft) 44.5 75.5 90.0 113.0 139.0 10848 Wheatlands Avenue Santee, CA 92071 619-562-2605 http://www.ccm-ent.com

Annual Sales: $20 million (company would not verify, 5/06) Employment: 135 (companysam wouldple not verify, 5/06)

Key Products: solid surfaceprofile materials, engineered stone; cultured “Demand for acrylic resins (e.g., methyl marble, onyx and granite; and fabricated products methacrylate) used in cast polymers is CCM Enterprises is a general contractor and manufacturer that projected to grow 6.1 percent per year serves homeowners, contractors, kitchen and bath showrooms, and to 225 million pounds in 2010. Not only major developers in the southern California area from five locations in does demand for acrylic resin benefit California. The privately held company’s products are made from engineered stone; cultured marble, onyx and granite; solid surface materi- from the rising popularity of acrylic solid als; and laminated plastic. surface compared to polyester-based versions, but acrylic/polyester blends are The Company is active in the US cast polymer industry through also continuing to overtake pure poly- the production of a wide range of kitchen and bathroom countertops, bathtubs, shower pans, bath walls and accessories using solid surface ester solid surface in terms of volume materials; engineered stone; and cultured marble, onyx and gran- demand. Acrylic’s strong growth also ite. These surfaces are produced in eleven standard styles, as well as stems from ...” custom designs. CCM Enterprises fabricates its countertops, bathtubs, shower pans, bath walls and accessories at a facility in Santee, Califor- nia. --Section III, pg. 57

CCM Enterprises’ proprietary solid surface material is manufac- tured and sold under the CORINTHIAN 2000 brand name and is designed to resist damage from perfumes, hair dyes and other household

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