The leaders of an aluminum manufacturer are on track to have more than $2 billion in 2021 sales and said this morning that they intend to relocate their California headquarters to Franklin.
The planned move by Kaiser Aluminum marks the eighth addition to the office roster at the McEwen Northside development, where the company will join the likes of Mitsubishi Motors and Williamson Inc. Kaiser (Ticker: KALU) is a publicly traded corporation worth about $2 billion and it's at the forefront of the global semi-fabricated specialty aluminum products sector. Its client base includes companies in the aerospace, automotive, packaging and general engineering sectors — with automotive being the only end market in which Kaiser did not see post-pandemic conditions improve this spring. Its relocation comes with a $3 million investment that promises 80 new jobs.
“Williamson County provides the benefit of a corporate-friendly business environment and access to a highly talented workforce that fits well with Kaiser Aluminum’s corporate value of being a preferred employer and a great place to work,” said Kaiser President and CEO Keith Harvey.
An employer of 3,700 including engineers, metallurgists and technicians, Kaiser runs 14 production facilities throughout North America — two of which were built in the last three years — as well as several research and development centers. From Franklin, the corporation will oversee the production of complex flat-rolled aluminum in the form of plate, sheet and coil products; extruded aluminum such as rods, bars, distinct shapes and hollow products; drawn aluminum including tube and wire; and various cast aluminum products.
“Kaiser Aluminum has been a long-term employer in Tennessee through our Tennalum facility in Jackson and more recently with our new sales office in Knoxville. We look forward to expanding our presence in Tennessee as we relocate,” Harvey said.
The Tennalum facility at Madison West Industrial Park since 1989, a plant on whom Kaiser’s senior management bestowed its 2016 Circle of Excellence Award for safety, customer satisfaction and financial performance, manufactures aluminum screw machine stock for aerospace, automotive and general engineering applications. Many of the commercial aircraft people board are built with parts from Tennalum, and the same goes for air conditioners and cars.
Kaiser posted a 2020 profit of $28.8 million on net sales of $1.17 billion but incurred a net loss of $17.9 million this year on $1.07 billion in revenues. The $670 million acquisition of the Warrick plant in Alcoa, Indiana expanded Kaiser’s top line, however, adding Warrick’s 1,200 employees and placing more production focus on cans for packaging food and beverages. That deal, however, did not come without integration expenses and further investment, and combined with higher production costs, that dropped Kaiser into the red. Harvey and his team still foresee strong growth nevertheless.
“With the expected recovery rates of our end markets and the planned strategic investments, we will be well-positioned over the longer term to deliver value added revenue approaching $2.0 billion with a mid- to high-20 percent adjusted EBITDA margin,” Harvey told investors earlier this month after the company’s first-half EBITDA margin came in at 19.7 percent.