Coal’s the goal

Posted on 2 Mar 2010 by The Manufacturer

Increasing turnover by 150% is the stuff of business dreams, regardless of sector. However, for mining applications manufacturer, ATB Morley, the reality is proving to be more enjoyable still. Edward Machin reports.

Founded as the Morley Electrical Engineering Company Ltd in 1897, ATB Morley has undergone a host of changes since its inception as a manufacturer of heavy-duty electric motors.

Owned by the Summerscales family and based in Stanningley, Leeds, the business was sold in 1972 to global conglomerate the Bullough Group. In 2000, a buyout by its management team saw the company renamed Morley Electric Motors, with the purchase part-funded by Lloyds Development Capital.

Having grown at a considerable pace, Morley was acquired by its present owner, ATB Austria Antriebstechnik AG — an international group with corporate headquarters in Vienna, Austria, and primarily focused on the production of electrical motors and drive systems. ATB is owned by ATEC industries, also headquartered and market-listed in Vienna. ATB Laurence Scott in Norwich is part of the same umbrella organisation, having been rescued from administration by ATB Morley in 2007 and brought into the group.

ATB Morley manufacture bespoke, high-voltage electric motors. The majority — i.e. 70-80% — are for underground coal mining applications, largely to territories other than the UK. As such, 80% of turnover is export, with approximately 40% supplied to China, 20% to Australia, 10% to Russia/ the US, and varying amounts to Europe, Indonesia, Mexico and Turkey — with the remainder staying within Britain. “Our current situation is very different from the late 80s, during which we manufactured motors predominantly for the UK coal industry,” says managing director, Ian Lomax. “Indeed, the decline of the UK coal industry should have been the end of the road for Morley. However, the management team at that time decided to take the coal mining expertise to the global market, the result being a rapid transition into those territories where coal continues to be mined.” The importance of coal as a global resource should not be understated: it provides 40% of global energy and 70% of global steel production.

The remainder of motors manufactured by ATB Morley are typically destined for special purpose applications. These include air compressors, ministry of defence, autoclaves, polyethylene stirrer motors and ‘retrofit’ products which the original manufacturer either doesn’t produce or, as a company, no longer exists. “We will manufacture a motor to precisely replicate the original in capacity, while typically offering a small frame size,” says Lomax. “However, in doing so we ensure that motors are manufactured to guarantee as little disruption as physically possible — often a principal concern for our customers, given the logistical nightmare than can ensue in such installations.”

Growing pains? Not here…
Arguably the most remarkable aspect of ATB Morley’s recent endevours is the degree to which its turnover has ballooned in a relatively short period; from £7m in 2002 to £18.5m in 2009. Such enviable growth can be partly attributed to the company’s continuing to aggressively chase sales in both existing and newer markets.

“A particularly pleasing aspect of our tradition as an industry leader is the fact that our motors have a reputation for both reliability and the history of innovation that comes with the product.

In the coal mining industry, Morley is a well known brand,” says Lomax.

Continuous innovation is a key driver behind the company’s success.

While perhaps surprising to some, coal mining technology is developing at almost unprecedented levels year on year, with customers demanding higher output from a smaller envelope in their products. To cater for such requirements, in 2008 ATB Morley designed the first 11kV motor designed to run in underground mining applications. Similarly, Lomax confirms that the company is fresh from the sale of the world’s largest shearer-based, 1000KW motor, with an 1100KW model currently in the advanced design stage.

“In general, we do not design a new product and then take it to the market to see if there is a demand” he says. “Quite the opposite, in fact.

Customers approach the company with a design brief, which is accordingly designed and manufactured across ATB Morley’s facilities in Leeds, Stockport and Bradford.”

Innovation stations Unsurprisingly, the company’s recent growth has required a steady stream of production improvements. Having purchased Decko Maher and Emco machining centres in both 2008 and 2009, the current year sees ATB Morley with a budget of £700,000 to refurbish and/or replace a number of the company’s older production tools.

For example, says Lomax, “Our shot blasting facility is set for a facelift, which is expected to cost in the region of £100,000. Similarly, we are due to upgrade the remainder of our welding equipment.” Such investments are intended to ensure that the company can keep up with the pace of production while giving it increased capacities — setting the foundations for the future, in others words. While Lomax expects Morley to maintain its respectable year on year growth going forward, he concedes that 2010 is likely to represent a slower year for the sector in general. That said, although 2009 saw an absence of large capital projects being launched, the wider market is nonetheless beginning to see a cautious pick-up.

Royal approval
Coupled with the aforementioned turnover spike, ATB Morley won the Queen’s Award for Enterprise: International Trade in 2009 for doubling its exports over the three previous years. “Being presented with the highest accolade a company can win in UK business was obviously fantastic for all at ATB Morley,” says Lomax.

“Indeed, and in spite of our global reach, because of our size we very much maintain a family feel to the business. Moreover, since the company’s inception, and remaining through each transition in our ownership, is a pronounced ‘Morley culture’ which directs all that we do,” he says. The company defines itself as customer intimate, building on its reputation and experience in coal mining — but also as opportunistic, and typically prepared to pursue any opportunity in spite of the technical challenges involved. Recent examples include the 11kV motor and the largest shear motor but equally, at the other end of the scale, low power high voltage where a 30kW motor is supplied with 3.3kV. One difficulty in this approach, however, is in occasionally finding new markets, since the bespoke, purposebuilt approach can be applied to any application. As a result, says Lomax, “One of our targets is to make our capabilities more widely known, such that it would be unthinkable that any product could be envisaged without considering ATB Morley.” Central to ensuring an optimum environment for bespoke manufacture is the Morley culture of continuous improvement, a programme largely driven by its rigorous internal quality statistics. To effect such efficiency standards, the company tasked six teams to consider each aspect of the business in turn — customer interface and in-house production techniques, for example — and identify areas for improvement, where necessary. “The important point here is to avoid complacency; no markets or products standstill,” says Lomax.

“Similarly, while we must never lose sight of our roots in the mining industry and its importance to our operations,” he says, “a particular aspect of the company’s strategy was in seeking to avoid complete reliance on it, and thus missing opportunities in adjacent sectors.” With a rebalance of 10% in its orderbook — from 85-75% in favour of mining — ATB Morley has accordingly explored a range of niche markets in which to introduce its motors; projects for the MoD and in renewable power being two such cases.

Somewhat serendipitously, however, the growth in non-mining sectors has seen a concurrent increase in its traditional markets, demonstrating that, says Lomax, “After a century’s production of coal mining applications we are finding that we can roll this experience out to other markets. Often specifiers seem surprised — although delighted — to find that businesses like ATB Morley continue to exist in the UK. They do so by working in niche markets, being prepared to innovate and offering high levels of customer support.