Rapid Growth Projected for Key Applications in the $2 Billion Specialty Films Market

    EXTON, Pa.--Feb. 18, 2003--The specialty films industry is poised for rapid growth in many market segments after a period of industry structural changes over the past several years. Many companies have strengthened their position through significant capital investment, acquisition, joint ventures, or licensing agreements.
    New developments in specialty films are reaching unprecedented levels to meet the challenging and rapidly changing needs in end product requirements. The $2 billion market for specialty films in North America remains a bright light within the plastics industry, and is expected to continue growing at double-digit rates for the foreseeable future. These films bring specific performance traits including heat resistance, damage tolerance, dielectric properties, solvent and moisture resistance and barrier properties. Demand is being driven primarily by value created from improved property performance, in-processing benefits and final cost savings from high-performance films. Higher than average margins for the plastics industry are generated in this business due to the high average selling price for these films at over $3 a lb, with some individual products commanding prices of over $100 a lb.
    A number of market segments are expected to outperform the expected 12% annual growth forecast for specialty films industry, with several applications estimated to exceed 35% compounded annual growth over the next five years. Some of these areas are described below to illustrate the advances now taking place in specialty films:

    --  Advanced matrix PET films in plasma and LCD screens as flat
        panel technology takes aim at CRT displays
    --  Photochromic technology employed in tamper evident films which
        has become heightened due to increased global terrorism
    --  Medical diagnostic strips placed on human skin that allow for
        noninvasive testing
    --  Tough, resilient polyvinyl butyaryl (PVB) interlayer being
        used as safety film in hurricane-resistant glazing to meet
        pending coastal region legislation
    --  Advanced PET films provide holographic images and bar coding
        to prevent rising consumer fraud in credit cards and consumer
        products
    --  Nanocomposite films made from nylon, polyester, and
        polypropylene targeting barrier packaging uses
    --  Fluoropolymer films used for proton exchange membrane in fuel
        cell technology
    --  In-mold labels from polycarbonate and acrylic provide mass
        customization feature to cell phones and automobile components
        at lower cost
    --  Metallized films provide EMI/RFI shielding as cost-effective
        alternative to traditional coatings in automotive electronics
        and business equipment

    Principia Partners, the Exton, PA-based consultancy, is conducting a focused multi-client report on the best opportunities for specialty films within this exciting and rapidly changing industry in North America titled SPECIALTY FILM - OPPORTUNITIES IN HIGH-GROWTH APPLICATIONS, NORTH AMERICA. Traditional food packaging applications have been excluded from this analysis, along with lower priced film types. The report is scheduled for publication in September 2003.
    "The objective of the report will be to zero in on applications that are rapidly changing where specialty films bring unique performance and value to the customer," according to Lou Rossi, a senior partner at Principia. "These value-added market segments represent the best opportunities for specialty film producers to generate high margins in a tough economy."
    Each year Principia Partners publishes several reports related to the plastics, materials and chemicals industry. Consultants from Principia's professional staff who have monitored the business development activities in specialty films for over 15 years will prepare the analysis.

    Principia Partners is an international business consulting firm serving the plastics, materials, building products and specialty chemicals industries. For more information about the upcoming analysis of the specialty films business, visit the company's web site at www.PrincipiaConsulting.com.