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Volume 47, Issue 5 - May 2012

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www.usglassmag.com/de/0512p36

Consolidation Completion
Trulite CEO Looks Toward Future
by Penny Stacey

"We all want to be liked and we want the customers and the industry to like us, but we do have to make hard decisions in these times."
—Jeff Leone,
Trulite Glass & Aluminum Solutions

Trulite Glass & Aluminum Solutions was created through a merger of Arch Aluminum & Glass, ACI Glass Products (formerly Vitro Architectural Products) and United Glass Corp. under the ownership of Sun Capital last July. Now, nine months later, the integration of the three under one consolidated company is complete (see related story in August 2011 USGlass, page 16). Trulite CEO Jeff Leone recently took the time to talk with USGlass (USG) about the integration, both the company’s and industry’s challenges, and what he sees ahead for the economy.

USG: How has the integration gone?
Jeff Leone (JL): The integration is over now. We’re back to doing business. All of our locations are in a calm perspective and they’re out trying to delight customers, making phone calls, making great glass products. We’re really beyond the integration. I would say the last six months we’ve been very busy. The Trulite team worked very hard. I am very proud of how we got through the integration as quickly and efficiently as we did and we’re back to normal business. Our last integration project is in Canada, where we believe we’re creating the largest, most professional glass fabrication center in North America. I couldn’t put any more adjectives on that. It’s going to really have the best equipment, the best people, and [will be] one of the largest centers in North America. We expect from this site in Toronto to supply not only all of Canada but maybe some of the project work we do in the Northeast of the U.S. So in line with all the other integration work we did, Canada’s going to be marvelous and it’s our last project that we’re just completing.

USG: There’s been a lot of disheartening news in the industry of late, such as the bankruptcy of Trainor Glass (see related story in March 2012 USGlass, page 24). I understand you’re one of the company’s creditors. How does that affect you as a company?
JL: You know, I think the industry’s still going through flux. We’re going to deal with this together. We want our contractors to get paid. That’s very, very important because if their cash flow’s no good, it’s going to affect fabricators. So it’s in our interest that we all take quality work and we get quality jobs and we get paid on time. We support our contractors very much so that the building owners and general contractors can’t be holding up their money on a job well done. We need to make sure that cash flows so that we can take on the next job and the next. So is the industry going to see more of this? Yes, it will. Are we prepared to deal with it with a very rigorous process? Yes, but we’re also sensitive that our contractor customers are in the same soup and we want to help them as much as we possibly can.

USG: Grey Mountain recently acquired both Binswanger Glass and Columbia Commercial Building Products and the firm was one of Arch’s suitors. Do you think you will be competing against a similarly situated company in the future?
JL: I think it’s natural when an industry that we invest in, when you see an industry in distress, people will try to look and say, ‘is now the right time to buy?’ It’s like looking at a home in a neighborhood you always wanted to be in. Maybe the prices are right today. So are more people going to try to invest in our industry space? Probably. And Grey Mountain is certainly a viable company, a very profitable private equity company, and I’m sure there are going to be other investments, but I want you to know also that Trulite is not done investing. With our partners at Sun Capital we’re very active right now looking at additional investments. We have a number on the board right now both in glass fabrication and aluminum fabrication. We expect Trulite to have more news in the short term and to grow even more We’re an active investor and we’re not done with the platform. We’ve just built it and we have ambitions to go further.

USG: The old Arch’s mantra was “always your supplier, never your competitor.” Is that still true today for Trulite?
JL: Absolutely. That was a very smart comment by Arch and we fully support that as Trulite. We know the industry space we’re in. We do not compete with our customers. Binswanger, when we bought Vitro, was strategically always destined to be sold. It was a question of when, and we were lucky enough to find a partner to buy Binswanger. I think Binswanger has got a great future with a dedicated owner that’s going to work on that business. It’s going to be a great business. But we aren’t going to own it because we don’t want to be a competitor.

USG: There is a fair amount of negativity toward Trulite on the web and a ton toward Sun. Any theories as to why that might be?
JL: You have to remember that we have had to change a number of people in key positions and locations that people were used to had to be closed in order to right-size the business. We have to look back and I have to worry about more than 2,000 employees that Trulite has and their families. If I don’t build a solid financial platform for them, I’m not doing my job. I don’t like seeing the blogs any more than any of us do. We all want to be liked and we want the customers and the industry to like us, but we do have to make hard decisions in these times. And, keep in mind, the reason we were buying these companies was because they were bankrupt, they were dark, and all of these people would have lost their jobs had we not taken aggressive action. Painful as it is, I think good businesspeople make decisions and move forward and I think we’ve done that.

USG: What do you think the average contract glazier will look like in the future?
JL: I think the contract glaziers, like the fabricators, are going to focus on service and differentiating themselves by reliability. For the contractor, a lot of that has to do with project management. They have to choose a fabricators that provide great quality that they don’t have to worry about, and then they have to manage their projects very well. At the end, they’re going to have to have a more robust process to collect their money, because we all know that’s a challenge today. I think the glaziers that get through this time are going to end up being truly terrific companies because they’ve weathered the storm. They will have fixed their processes underneath, and they’re going to be ready to handle the growth that the industry’s going to see in a few years.

USG: Is there anything else you’d like to tell our readers?
JL: First, I’d like to tell them that we appreciate the opportunity and please give Trulite a try—try the new Trulite out. Come see our locations, meet our people. It’s a new vibrant organization with people that truly want to delight the customer. That’s number-one. Number-two, this is a tough industry but we’re all going to get through this cycle. We’re probably looking at the back end of this now and, as we were a few years ago, we all need to stay consistent, stay reliable to our customers and our suppliers, and we’re going to be just fine.

USG: A lot of what we’ve been hearing is that 2012 is looking optimistic—are you seeing signs of an uptick as well?
JL: Yes, [but] it’s an uptick off a small base. So, whenever you measure off of how much the industry came down, are we seeing it grow? Yes, but it’s still on a relatively small scale. We just have to keep that in perspective. But, you know what, the industry will get back, if not to the ’07-’08 levels, it is going to grow again, so you don’t want to build your whole culture of thought around staying at this low level. You have to build processes that can handle the lift that will occur, because you still have to stay reliable to your customer when the business picks back up, and it will pick back up. 2012 may not be the magic year; I’m thinking that in general, if you look at residential and commercial together [in terms] of usage of glass, it will be ’13 and ’14. But if you look at the automotive industry, nobody would have thought that they’d be selling as many vehicles this year as they did a couple of years ago. The construction industry’s going to be the same way. Just give us a couple more years.

USG: Thank you for your time.
JL: Thank you.

Penny Stacey is the editor of USGlass magazine. She can be reached at pstacey@glass.com.
Read her blog at http://penny.usglassmag.com, follow her on Twitter @USGlass, and like USGlass Magazine on Facebook to receive the latest updates.