State of the Nation

by E. W. Phares II

The company has now completed the first 10 months of fiscal 2010 and I am most pleased to report that we continue with both sales and profit behind our plan but nicely ahead of last year. In spite of our continued soft national economy, our sales held up quite well in all divisions.

We are continuing quite profitably in Canada, but unfortunately, as reported earlier, our sales to Encana have been reduced considerably due to a process change within their operation. Sales in all other areas, including supermarkets, have continued well above last year, however, we anticipate that the Sobeys sales, due to our loss of the contract in Ontario, will be considerably lower for the rest of the year.

Penetone sales are holding up well and we expect to be equal to our plan and ahead of last year. Military sales and pulp and paper sales are nicely ahead of last year although there has been a drop off in our business to the petroleum and the pipeline industry. We remain optimistic and anticipate that we will achieve our profit plan for the year.

Petron sales continue to rebound from last year, and, except for the cement industry in the U.S., our sales to all other marketing areas are doing extremely well, especially with the rejuvenation of business in the iron ore industry. Our sales opportunities off-shore with the addition of our new personnel in China and India are going quite well and we are extremely optimistic about our off-shore sales during the latter part of 2010 and in 2011.

In spite of the slow growth in the U.S., our markets are holding up well and our off-shore opportunities both in pulp and paper at Penetone and Far East sales for Petron strongly anticipate that we will be equal to plan in both sales and profit in 2010.

My thanks and congratulations to all for your continued commitment to our company.

Penpower 101:

Persistence

by Bruce Muretta

Persistence is defined as resolute action in spite of opposition, importunity, or warning. At no time has this characteristic paid more dividends than in this uncertain economy for Penetone. The roots of our current successes reach back years.

Mike Nelson has pursued our strong domestic and international customer base for many years. Constant attention to these accounts in lean years established contacts and product excellence awareness for proper positioning in this recycle paper market of poor feedstock requiring our stickies removal products.

Jimmy Hasssell’s attention to the pipeline industry during many years of minimal projects requiring chemical cleaning has scored greatly the last two years. He has kept close to all contractors and informed when all major projects came to fruition.

Military sales increases have resulted from bid board awareness, product development and military base operations knowledge. Charlie Good continually follows product requirements providing guidance to sales personnel to timely provide the right product. Jim Brooks, Chad Tennant and Susan Lampson stay in constant communication with their assigned installations knowing product requirements and competitive products.

Sylvia Paredez and Maria Carcel have maintained a solid customer base without a dedicated sales person for over ten years. They have remained close to all their customers providing excellent service, never dismissing the smallest customer.

Heather Perine’s wealth of customer requirements and knowledge and tremendous people skills avoids almost all customer service problems. Eversley Brown, Luis Suruy and Blas Hernandez meticulous quality blending and Ron Costello and Colonel Robertson’s uncompromising packaging and shipping procedures ensure an excellent product is properly delivered.

In the very competitive industry in that we are engaged, the above cited persistence of effort has resulted in excellence improving sales and profits.

To see and be seen

By Paul Hayden

The Western industrial division unveiled a new trade show booth at the Fort McMurray oil show, September 15/16/2010. Attending the show were Greg Cebuliak, Wayne Dory, Jean Richard and Paul Hayden. This is the first time a trade booth had been specifically designed for the industrial markets in Western Canada and was well received by all.

Heartfelt thanks to Josee Mercure our marketing coordinator in Montreal for all her hard work designing the artwork for the booth. Josee kept the marketing messages concise by using some of the same images both in our marketing pamphlets and in the booth artwork thereby keeping the marketing message by segment consistent and streamlined. Overall the booth and marketing materials look fantastic!

The oil show itself featured many new and incumbent vendors from previous years but with new vigour as the oil show had been outside Fort McMurray for a number of years.

Several very good leads came from the show this year and are currently being followed up; the most significant of these being able to meet the engineers of the Husky Sunrise oil sands project... more to report on this opportunity later.

As important as these leads were and are, it is just as important to see and be seen. The new trade booth will go a long way to achieving prosperity for the Western Industrial Division. See for yourself...

Petron invests in tanker safety

By James Bittner

Petron loads and unloads almost 40 bulk tank trucks per month. The tanker handling activities require employees to climb 12 feet to the top of the tanker and then walk across the top of the tanker to each hatch to open the tanker for unloading. When they’ve completed unloading the tanker, employees have to climb back up the tanker to close the hatches before the tanker departs.

Loading a tanker often requires more trips to the top of the tanker. It is not uncommon for an employee to climb to the top of a tanker three or four times during the loading process in which they open and inspect the interior of the tanker before loading and sample, close and seal the tanker after loading.

The climb to the top of the tanker is via a vertical metal ladder. Once on top of the ladders, employees must make a precarious transition from the ladder to a narrow walkway to get to each tanker compartment’s hatch. Water and ice on the tanker and heavy, cold weather clothing during make the job more hazardous.

To reduce the chances of employee injuries occurring from a fall from the tanker, Petron has invested in a Beamglide Trolley system with a self-retracting lifeline (SRL) that travels along an I-beam system suspended from roof trusses 18 feet above the ground. Employees attach the SRL to a full body harness before starting to climb on the tank truck. The Beamglide Trolley system allows workers to move back and forth along the length of the tank truck. The SRL extends and retracts as the employee moves away from and toward the device. In the event of a fall, an energy-absorbing brake activates, stopping the fall while reducing fall forces and distance. The SRL unit behaves very similarly to a seatbelt in your car if you slam on the brakes.

While we haven’t experienced an injury from a fall from a tanker, the likelihood of an injury increases as we continue to handle more bulk tank trucks. Our safety equipment provider stated that less than 10% of bulk truck handling facilities has fall protection in place. Most of them offer no protection to their employees when climbing and working on tank trucks. Petron is proud to put safety at the forefront of our operations even when the rest of industry does otherwise.

New equipment increases productivity

by Elisa Pieroni

During the past year the lab blended and brought in seven new Toll Blended products into the manufacturing mix. These seven new products brought in twenty new raw materials that need to be quality checked each time they come into Petron and before being used in any batches.

The lab has now put a Mettler T50 Auto Titrator into service to allow us to test to the Customers’ Specifications. This also helps release the product from the kettle 3 days sooner than if we had to send this material out for special testing.

Electronic communications

By Kimberly Garrity Lyons

The cartoon selected for this issue is a timely one in that we’ve seen in the media recently the disastrous uses and effects of modern technology. Technology is increasing more rapidly than the courts and businesses can keep up with the uses – both positive and negative.

The Company has developed a policy in an effort to address these “mis-uses” of communication. The policy reminds everyone that the computer systems, email systems, voice mail systems, etc are company property. And, as such, the same standard of acceptable business communications, including compliance with our anti-discrimination and anti-harassment policies, applies to these forms of communication as well.

The Company holds that all messages and transmissions composed, sent, stored or received are not the private property of the employee and reserves the right to access, retrieve, audit, monitor any such communication. It also stresses the importance of using due diligence in keeping all proprietary information confidential.

Service Awards

July – December 2010

Congratulations to the following employees on their service achievements:

• Jim Bittner – 5 years – Petron

• Raja Rajendram – 20 years – W/P

• Miguel Martinez – 10 years – Petron

• Jack Schuler – 35 years – Petron

• Felix Ralph – 5 years – W/P

• Wayne Dory – 10 years – W/P

• Mike Butler – 10 years – W/P

• Joe DiPasquale – 5 years – W/P

• Matt McClellan-3 years - Petron

• Mike Bradford – 25 years– Penetone