Discontinued Operations: Water Care Business Unit
On 1 November 2018, Lonza announced that we had entered into a definitive agreement with Platinum Equity to sell Lonza’s Water Care business. Therefore, Water Care is being reported in 2018 as discontinued operations. For more information, refer to Results from Discontinued Operations.
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While the Water Care business unit contributed to our portfolio of delivering solutions for the Healthcare Continuum® through clean water for residential and commercial use, the business model does not fully fit with the overall Lonza portfolio. The residiential Water Care business follows a business-to-consumer approach whereas all other Lonza businesses follow a business-to-business approach. We believe that we have found the optimal partner for the business to develop as an independent company through investing in innovation and growth and with that give new perspectives to the global sites and its employees.
As a highly specialized service provider the Water Care business is one of the world’s leading suppliers of sanitizers and other treatment chemicals for pools, spas and water parks. It is also rapidly growing sales in the treatment of surface waters, as well as water for drinking, agriculture, irrigation, food processing and industrial applications. For these types of applications, it offers oxidizing and non-oxidizing biocides, proprietary halogen stabilizers and innovative solutions that include proprietary feeder systems and controllers.
Water Care has strong leadership positions around the world. The business has a long heritage of providing clean-water solutions, with more than a century of experience in developing innovative water-treatment offerings.
The areas of application for Water Care products include residential and commercial swimming pool and spa water, as well as drinking water, process water, wastewater, irrigation, surface water and industrial water. The business builds customer relationships by offering technical customer support, research & technology, formulation expertise, regulatory excellence and powerful brand marketing, as well as product reliability and quality. The Water Care business is divided into two sections based on customer needs: Residential Water encompasses ProDealer and Mass channels and Industrial, Commercial, Municipal and Surface Water (ICMS) offers chemicals and services.
The Residential Water brands keep recreational water clean and free of algae and bacteria, while maintaining chlorine stabilizer and pH levels within the recommended ranges.
The ICMS business includes a broad portfolio of chemicals, formulations and innovative solutions to answer customer needs for water sanitization and treatment. As highly specialized service provider, Water Care offers a wide range of branded products to the market and provides onsite support for end-use customers. The ICMS business supplies products and automated feeder systems for commercial pools, including theme parks, hotels, public pools and camp parks. In addition to municipal drinking water and wastewater treatment facilities, it offers industrial water solutions for processes used in the pulp and paper, food and beverage, power, chemical and steel industries.
Highlights and Initiatives 2018
Throughout the year the Water Care business continued to implement commercial excellence initiatives and innovative new offerings but faced headwinds due to a late seasonal start in North America and Europe and higher transportation costs. However, new customer contracts were secured for the recreational and industrial water businesses; and the outlook for 2019 is positive while restructuring and business model redesign are ongoing. In addition, new business development efforts within the e-commerce space are fully on track and are expected to show accelerating growth momentum.
Significant investments in innovative new offerings and related brand restaging, supported by sales initiatives and expected new business in recreational water, are strengthening the mid-term outlook. We introduced the following new products and innovations, among others, within our residential businesses:
HTH® Text Strips help consumers by bringing smart technology to manual testing of pool and spa water. Consumers text an image of their test strip to a dedicated number and receive a text with recommended dosing and step-by-step care instructions.
HTH® and Spa Selections® are bringing digital packaging to the pool and spa-water care space. Consumers scan the digitally enhanced packaging with their smartphone for at-shelf access to a broad range of information.
Pulsar® Infinity and CCH® Endurance Feeder Systems, a slow-dissolving calcium hypochlorite feeder system, gained wide acceptance and adoption by major dealers and pool operators alike within the commercial pool segment.
Pond-Klear™ is a fast-acting aquatic herbicide that produces visible results in a significantly reduced time.
In 2018 the Industrial, Commercial, Municipal and Surface Water (ICMS) business also continued to invest in innovative technologies and offerings under the BlueSenseTM business platform, e.g. in technologies to convert chlorides naturally present in water into effective disinfection agents.
Another example is the Frexus® Granular offering. According to label instructions for applications such as hard-surface disinfection, washing of fruit and vegetables and carcass washing, the risk of potentially harmful organisms can be drastically reduced.