The Morgan Crucible Company plc
The Morgan Crucible Company plc
Quadrant 55-57 High Street
Windsor, Berkshire SL4 1LP
Telephone: (44) (01) 753 837 000
Fax: (44) (01) 753 850 872
Web site: http://www.morgancrucible.com
Sales: £745.7 million (2005)
Stock Exchange: London
Ticker Symbol: MGCR
NAIC: 423690 Other Electronic Parts and Equipment Merchant Wholesalers; 327124 Clay Refractory Manufacturing; 327125 Nonclay Refractory Manufacturing; 442299 All Other Home Furnishings Stores
Based near London, The Morgan Crucible Company plc is a leading industrial manufacturing enterprise. Morgan is organized into four global business units (GBUs). Its Technical Ceramics GBU is engaged in the manufacture of industrial ceramics products. Thermal Ceramics concentrates on insulation and refractory products, such as high temperature insulating refractory bricks and refractory monolithics. The company's Crucibles GBU, formerly named Morgan Molten Metal Systems, manufactures crucibles, furnaces, and other products used by foundries. Finally, Morgan's Carbon GBU makes carbon brush and related components, including graphite powder, body armor, and components used for space exploration.
ONE-HORSE START: 1856–1899
According to excerpts from Battersea Works 1856–1956, an early history published by Morgan Crucible, the company's origins date back to 1850s London where five brothers, the Morgans, ran a hardware and druggist sundries business. Crucibles—pot-shaped containers in which metal or glass can be melted—were among the items the brothers sold. A monumental development occurred when the brothers attended the Great Exhibition of 1851, an international exhibition in London's Hyde Park that intended to promote and expand industrial design. It was there that the Morgans saw an American crucible from New Jersey-based Joseph Dixon and Co.
Acting on their belief that the American crucible was superior to those that England imported from Germany at the time, the brothers arranged to become Joseph Dixon's exclusive British importers. Initial success prompted the Morgans to buy manufacturing rights to the American crucible in 1856. A tiny factory was purchased in Battersea, powered by a solitary horse for grinding clay and consisting of a small brick kiln, mill, house, and dilapidated out-buildings. Led by William Morgan, the brothers swiftly improved the buildings and added a new kiln.
The Morgans' fledgling enterprise managed to survive its first year, with the brothers initially drawing a collective weekly salary of £8. This amount eventually rose to about £40 by early 1857, when the company adopted the name Patent Plumbago Crucible Co. Within five years the enterprise claimed that its crucibles were used by English, Australian, French, Indian, and Russian mints, the arsenals of Brest and Toulon, and the Royal Arsenal of Woolwich.
By this time the brothers retired their trusty horse, which was replaced by two horizontal 35-horsepower engines. Similar mechanical upgrades continued through the late 1880s, helping the company to further its growth. The re-named Morgan Crucible Co. then rested on the strength of 150 workers and enjoyed a reputation for being the world's largest crucible manufacturer. The company's products received numerous awards at international exhibitions and were coveted by competitors, some of whom were sued for copyright infringement.
Morgan Crucible became a public limited company in 1890, with Chairman Octavius Vaughan Morgan and Edward Vaughan Morgan among the firm's first board of directors. Another charter member of the board, Samuel Arthur Peto, later succeeded Morgan to become the company's second chairman. The company became a pioneer in the area of profit-sharing, as sales of shares were limited to employees.
INITIAL CHALLENGES OF A NEW CENTURY: 1900–1949
At the turn of the twentieth century, Morgan ventured into the manufacture of carbon brushes. Initial experiments led to the formation of a dedicated research group, dubbed the "Z Department," in the fall of 1904. Orders eventually were received from the likes of AEG and Siemens, and cities throughout the world soon used the brushes for their railway and tram systems.
Morgan's brush products evolved so that by 1910 the company had formed the Morganite Brush Company Inc., an overseas branch office in New York that became profitable in short time. By 1912 Morgan offered several different kinds of brush products, including Carbon, Copper Morganite, Electro-graphitic, Hard Morganite, and Morganite.
World War I created great demand for Morgan's products. For example, in September 1916 alone the firm received orders for 500,000 brushes. However, the company quickly focused on controlling costs and rebuilding its export business in order to survive in the difficult post-war economic climate. Even so, brush and crucible sales dropped to half of what they had been during the war, prompting wage and workforce reductions.
Despite these difficulties, Morgan continued to grow. Doulton and Co.'s crucible operation was acquired in 1919, and by 1925 Morgan was reaping record profits. That year the company moved ahead with construction of a new plant in Long Island, New York, for its U.S. operation. This came as no surprise, as the American automotive industry proved to be a key market during the 1920s.
During the 1930s the Great Depression forced Morgan Crucible to seek new opportunities. This led to the firm's foray into battery carbon production in 1931. Throughout the 1930s the company continued to venture into new areas, from furnaces to radio resistors.
Like many other manufacturers, Morgan Crucible benefitted from military-related production during World War II. By the end of March 1940 the company's sales totaled £2.47 million, an increase of £500,000 from the previous year. The Battersea plant in central London managed to escape destruction, although production was spread out to plants in North Stafford-shire and Worcester to minimize risk.
During the war the company's U.S. operation was renamed Morganite Inc. As American males joined the war effort in large numbers, the plant faced serious labor shortages. By hiring female workers, Morganite saw its workforce swell by 1,100, but the enterprise still contended with a six-month order backlog. Additional expansion in 1944 included new operations in Canada, Australia, and South Africa.
In 1946 the company broke a 60-year tradition when it issued shares of stock to outside investors; a limited number of "A" shares were offered to the public, while a larger pool of "B" shares were reserved exclusively for employees. That year, the company created a staff college that prospective executives could attend during working hours.
Morgan aims to use its skills effectively to make technically superior engineering products that are designed to meet customer needs and maximise shareholder value. Inherent in this mission is our intention to conduct Morgan's business in a responsible manner.
After the war, Morgan faced a number of challenges, namely material and labor shortages. In his annual speech to shareholders Morgan Crucible Chairman P. Lindsay indicated that issues such as these were additional hardships for a management team that was already fatigued and overloaded. However, conditions soon improved. By 1947 the company had reestablished relations with prewar customers throughout Europe and exports had surpassed 1938 levels.
Competition from other domestic manufacturers started to increase by the end of the decade, in step with Europe's post-war recovery. The company continued to expand and diversify. A new subsidiary named Morgan Refractories Ltd. was formed in November of 1948 to produce specialized refractories. In fact, by the end of the 1940s Morgan had extended its product lineup well beyond crucibles and carbon brushes to include many specialized items.
In the July 20, 1949, issue of The Times, Chairman P. Lindsay noted the many applications of the company's products, explaining: "corrosive liquids are contained in carbon tanks and flow through carbon pipes; increasing interest is being taken in carbon linings for blast furnaces; carbon collectors are standard equipment on trolley-buses, cranes, and many locomotives; carbon contacts are in use for electrical control and signal devices; in freeing the harbours of Europe from the debris of sunken ships carbon electrodes have formed part of the underwater cutting equipment; carbon clutch rings, pump seals, and Reservoil bearings will be found on most road vehicles; in domestic apparatus also, such as vacuum cleaners, fans, and clocks, Reservoil oil retaining bearings find their essential use."
GROWTH & EXPANSION: 1950–1989
As the 1950s dawned Morgan Crucible contended with a number of challenges, including inflationary pressure. Uncontrollable cost increases occurred in areas from building construction and transportation to fuel and power. However, progress continued. By 1950 the company had formed a centralized research and development department to coordinate the efforts of the parent organization and its growing subsidiary base. Construction of a new research lab was well underway by 1951, and the company had acquired a large factory in Cheshire for Morgan Refractories.
Strong production and sales led to record group trading profits in 1955, and the company moved forward with a number of new ventures late into the decade. In 1958 a new factory was erected to produce a non-metallic heater element named Crusilite. The company also became involved in production and research related to sintered alumina products. In addition, through a venture with A.E.I.-John Thomson Nuclear Energy Co. Ltd. called Nuclear Graphite Limited, Morgan produced high-quality graphite for use in nuclear power plants. The company also was involved in making other components for nuclear reactors. In 1959 Morgan drew approximately 40 percent of its sales from overseas, down from about 45 percent in 1958. This was reflected in the company's movement into markets such as Japan, Brazil, and Mexico.
A number of important changes took place during the 1960s. Morgan began the decade with a new chairman, A.L. Stock, who succeeded P. Lindsay upon his retirement. On the international front, existing operations were expanded in Canada and South Africa.
Significantly, in April of 1961 the Morgan Crucible Co. Ltd. ceased to be a traded entity. A reorganization effort saw the company's domestic operations transferred to three wholly owned, trading subsidiaries: Morganite Carbon Ltd., Morganite Crucible Ltd., and Morganite Electroheat Ltd. Other subsidiaries within the Morgan Crucible Group included Morganite Research & Development Ltd., Morganite Exports Ltd., Morganite Resistors Ltd., Morgan Refractories Ltd., Morgan-Mintex Ltd., Graphite Products Ltd., and the Ship Carbon Company of Great Britain Ltd. Beyond these enterprises were twelve international subsidiaries.
- After acquiring manufacturing rights to an American-made crucible, the five Morgan Brothers purchase a factory in Battersea, starting their own crucible enterprise in the United Kingdom.
- Morgan Crucible becomes a public limited company.
- After a 60-year practice of issuing stock only to employees, a class of shares is made available to the public.
- A reorganization effort results in domestic operations transferred to three wholly owned subsidiaries: Morganite Carbon Ltd., Morganite Crucible Ltd., and Morganite Electroheat Ltd.
- With representatives in 80 countries, Morgan consists of 25 U.K. subsidiaries and 15 overseas companies.
- A reorganization initiative results in the adoption of a new operational structure.
- Morgan celebrates its 150th anniversary and its 60th year on the London Stock Exchange.
Morgan's growth continued into the mid-1960s. In 1963 Morgan-Borel S.A., a new Swiss subsidiary, was formed in partnership with Borel S.A. Steatite and Porcelain Products, an industrial ceramics firm based in the United Kingdom, was acquired in 1964. In order to provide more efficient and effective service, a new enterprise was established in 1965 to handle the technical services and sales needs of seven Morgan companies. A 26 percent stake in plastic moldings firm Bettix was purchased in 1966, and the remaining shares were acquired later in the decade.
While a company advertisement in 1969 used the tagline "Morgan—a name to remember," literally recalling the name of every Morgan enterprise was a virtually impossible task. By this time Morgan had evolved into a massive enterprise, with annual sales of £25 million, of which 46 percent came from international operations. The Morgan empire relied on the strength of representatives in 80 different countries and included 25 subsidiaries in the United Kingdom and 15 overseas companies. These various enterprises all fell under one of three main divisions: Thermic, Carbon, or Electronics.
The early 1970s ushered in difficult times in the form of a sluggish economy, both in the United Kingdom and the United States. This, in turn, had a negative impact on world trade and contributed to a drop in Morgan's profits. Another factor was the major expense involved in transferring operations from the Battersea plant to new locations.
Due to space constraints, the original 11-acre Battersea location purchased by the five Morgan brothers was no longer suitable for the growing enterprise. Preparations to relocate had begun in 1967, and a new 40-acre location in Morriston, South Wales, was selected as a replacement. By the mid-1970s Morgan had moved its carbon brush operations to Morriston, and crucible manufacturing was transitioned to a location in Worcester.
There were other positive developments during the 1970s. Copeland and Jenkins, as well as the Park Royal Porcelain Co., were acquired in 1971, and Morgan began producing small aluminum oxide boxes that integrated circuit manufacturers used to protect silicon chips—a critical component in the growing world market for electronics, namely calculators and computers.
During the early 1980s Dr. Bruce Farmer was named as Morgan Crucible's chief executive. He assumed the role of group managing director in 1983, succeeding John Gilbert upon his retirement. Farmer, who had joined Morgan in 1981, went on to lead the company for 14 years.
The 1980s were marked by a flurry of acquisitions. In 1980 the company acquired Cleveland, Ohio-based Franklin Oil, a producer of lubricants for metalworking. Franklin was added to a Morgan division that included the industrial lubricant producer, Rocol. Another U.S. acquisition followed in 1981, when Hydrotex Industries, a manufacturer of petroleum-based products used for engine protection and plant maintenance, was purchased for $35 million. On the carbon front, Union Carbide's Greenville, South Carolina-based carbon seal operations were acquired by Morganite Inc. in 1984. Two years later Morgan obtained another Union Carbide enterprise, National Electric Carbon, for £23 million. The £20 million purchase of General Electric's Carbon Products division followed in 1988.
The 1980s also saw the company expand in the area of technical ceramics. After the Morgan companies in this area were merged and renamed Matroc midway through the decade, a series of U.S. acquisitions began, starting with New Jersey-based Duramic Products Inc. in 1985. Cleveland, Ohio-based Vernitron, along with its U.K. subsidiary, followed two years later. The acquisition of a New Bedford, Massachusetts-based company named Alberox took place in 1988.
Morgan also boosted its thermal ceramics business during the 1980s. Thermal Ceramics Industries, which had operations in Girard, Illinois, and Canon City, Colorado, was purchased for £7.2 million in 1984. In addition, Morgan acquired the Insulating Products Group in 1987 for £37 million.
A SHARPER FOCUS: 1990–PRESENT
The 1990s brought more acquisitions that expanded Morgan's business across its key operating areas. In January 1990 Manville International's thermal ceramics and electronics operations were acquired for £50.9 million. The following year GTE's Wesgo was acquired, along with Rhode Island-based Carbon Technologies and Pennsylvania-based Fulmer. Midway through the decade, Pennsylvania-based Pure Carbon was acquired in a $30 million deal.
In addition to these acquisitions, Morgan entered into a 50/50 joint venture with Japan's Nippon Steel Chemical in 1997, establishing a new company called Shinnikka Thermal Ceramics Corp. to produce ceramic fiber. Headquartered in Tokyo, the new venture's manufacturing operations were located in Sakai. Shinnikka sought to take advantage of projected ceramic fiber demand in the near and Middle East, as well as Southeast Asia.
During the mid-1990s Morgan faced falling demand for ceramics from semiconductor companies; economic woes in Japan, Germany, and France; as well as weak demand from the U.S. nuclear power and defense sectors. Against this backdrop the company cut costs and focused more on its carbon and ceramics businesses. In 1998 Morgan put its specialty materials division, which included aerospace coatings and lubricants, up for sale. The following year it sold product lines that included scales and radiation monitors for mobile equipment and forklifts. In 1999 Morgan also announced that it would trim 1,100 jobs from its workforce as part of a $33 million cost reduction initiative.
Morgan began operating in its third century in 2000. By this time the company's ceramics arm included products used by the telecommunications, medical, aerospace, and semiconductor industries, as well as alumina ceramics used in personal and automotive body armor. Growth in the ceramics sector included the acquisition of New Hampshire-based Performance Materials Inc.
Morgan reorganized in 2003, at which time a new operational structure was chosen. The company continued to shed non-core operations, including its consumer and automotive businesses, and consolidated nine global business units into six. In addition to streamlining its organizational chart, the company made efforts to implement a new performance-based culture and put more of an effort on commercialization. Research and development programs were simplified and placed back in the hands of individual business units.
Morgan sold its Magnetics unit for £300 million in late 2005. That same year, regional headquarters for Morgan Thermal Ceramics Shanghai Ltd. were established in Pudong, China. At this time Morgan claimed 55 percent of the global market for refractory fiber, as well as 40 percent of the world firebrick market.
The year 2006 was marked by two special milestones in Morgan Crucible's history. Led by Chairman Lars Kylberg and CEO Warren Knowlton, the company celebrated its 150th anniversary. In addition, the enterprise also was recognized for its 60th year of trading on the London Stock Exchange.
When the Morgan brothers formed their fledgling crucible business at Battersea with one horse in 1856, it would have been virtually impossible for them to envision the massive industrial giant it would become. Moving forward, the company's prospects for celebrating a 200th birthday seemed attainable.
Carl Nolte Söhne GmbH and Co. K.G. (Germany); Dalian Morgan Refractories Limited (China; 70%); Elettrolitica Del Basso Nera SpA (Italy); Grupo Industrial Morgan S.A. de C.V. (Mexico); Morgan Advanced Ceramics Inc. (United States); Morgan Advanced Ceramics Ltd.; Morgan Advanced Materials and Technology Inc. (United States); Morgan Korea Ltd. (South Korea; 93.2%); Morgan Rekofa GmbH (Germany); Morganite do Brasil Industrial Ltda.; Morganite Electrical Carbon Ltd.; Morganite Krug SA Industrial and Comercio Ltda (Brazil); Morganite Luxembourg S.A.; Morganite South Africa Pty. Ltd.; Murugappa Morgan Thermal Ceramics Ltd. (India; 51%); National Electrical Carbon B.V. (Netherlands); National Electrical Carbon Products Inc. (United States); Shanghai Morgan Matroc Technical Ceramics Company Ltd. (China; 90%); Shinnika Thermal Ceramics Corporation (Japan; 50%); Thermal Ceramics Deutsch-land GmbH & Co. K.G. (Germany); Thermal Ceramics de France S.A.; Thermal Ceramics Italiana S.r.l. (Italy); Thermal Ceramics South Africa Pty. Ltd.; Morgan Electro Ceramics Ltd.; Morganite Crucible Ltd.; Thermal Ceramics (U.K.) Ltd.; Thermal Ceramics Inc. (United States); W. Haldenwanger Technische Keramik GmbH and Co. K.G (Germany).
Technical Ceramics; Thermal Ceramics; Crucibles; Carbon.
Dixon Ticonderoga Company; Le Carbone Lorraine Company; Tokai Carbon Company Ltd.
"1,100 Jobs to Go at Morgan Crucible," ECN—European Chemical News, March 29, 1999.
"Bicron Buys Product Lines from U.K. Firm," Crain's Cleveland Business, December 20, 1999.
"British Ceramics Maker Morgan Crucible to Sell Specialty Materials Division," Knight Ridder/Tribune Business News, September 16, 1998.
"Company Meeting, Morgan Crucible Company, Continued Expansion, Increase of Capital," Times, August 7, 1946.
"Company Meeting, Morgan Crucible Company, War Economy and Future Trade," Times, July 21, 1945.
"Company Meeting, The Morgan Crucible Co., Ltd., Internal Financing of Development Projects, Four-Year £1,000,000 Plan, Ambitious Research Organization, Mr. P. Lindsay on Factors Affecting Trade," Times, September 5, 1950.
"Company Meeting, The Morgan Crucible Co., Ltd., Marked Improvement in Output, Unique Range of Products, Mr. P. Lindsay on Industrial Prospects," Times, September 3, 1951.
"Dr. Bruce Farmer," Materials World, June 1999.
"Interim 2004 Morgan Crucible Company plc Earnings Presentation—Final," Fair Disclosure Wire, August 4, 2004.
"Morgan Crucible Buy Stake in Bettix," Times, April 2, 1966.
"Morgan Crucible Buys US Group for £2.6m," Times, January 9, 1980.
"Morgan Crucible Expands in US," Times, July 23, 1981.
"Morgan Crucible Form Swiss Company," Times, December 16, 1963.
"Morgan Crucible Group Form New Company," Times, March 29, 1965.
"Morgan Crucible in $10m Deal," Times, May 1, 1984.
"Morgan Crucible to Set Up China Headquarters in Pudong," Asia Africa Intelligence Wire, October 31, 2005.
"Morgan Crucible Limited, Mr. P Lindsay on Expansion of Activities," Times, August 12, 1947.
"Morgan Crucible to Buy Rest of Bettix," Times, September 4, 1968.
"NSC, Morgan Tie Up in Ceramic Fiber," Comline Chemicals & Materials, April 7, 1997.
"Processing and Technologies, Body Armor from Morgan," High Tech Ceramics News, November 2000.
"The Morgan Crucible Company, Plans for Further Development, National Obstacles to Progress, Volume of Sales Maintained, Mr. P Lindsay on the Factors Affecting Profits," Times, July 20, 1949.
"The Morgan Crucible Company Limited, Export Business Continues to Prosper, Contribution to Nuclear Power Development, Trade Enters Period of Readjustment," Times, July 1, 1958.
"The Morgan Crucible Company Limited, Group Reorganisation Scheme, Mr. A.L. Stock on Proposed New Structure," Times, July 29, 1960.
"The Morgan Crucible Company Limited, High Level of Production and Sales, Record Group Trading Profit, Mr. P. Lindsay Reviews the Year," Times, June 28, 1955.
"The Morgan Crucible Company Limited, Opportunities for Expansion Actively Pursued, Strengthening of Oversea Organization, Mr. P. Lindsay's Tribute to Staff," Times, July 7, 1959.
"The Morgan Crucible Company Limited, Results Reflect Sales Expansion, Speedy Recovery of Morganite Resistors, Decentralization Policy Continues, Mr. A.L. Stock on Trading and Outlook," Times, July 5, 1960.
Wilson, Andrew. "Two-year View on Morgan Crucible as Order Book Begins to Fill," Times, November 4, 1972.
"The Morgan Crucible Company plc." International Directory of Company Histories. . Encyclopedia.com. (October 21, 2018). http://www.encyclopedia.com/books/politics-and-business-magazines/morgan-crucible-company-plc
"The Morgan Crucible Company plc." International Directory of Company Histories. . Retrieved October 21, 2018 from Encyclopedia.com: http://www.encyclopedia.com/books/politics-and-business-magazines/morgan-crucible-company-plc
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