Ecolab cleans up by cleaning up. The company offers cleaning, sanitation, pest-elimination, and maintenance products and services to hospitality, institutional, and industrial customers. Its Cleaning and Sanitizing operations serve hotels, schools, and commercial and institutional laundries and account for more than half of its total sales. Its Kay unit provides cleaning supplies to quick-service restaurants. Other units focus on products for textile care, water care, health care, food and beverage processing, and pest control. It also makes chemicals used in water treatment for industrial processes, including in the paper and energy industries.
Ecolab operates in more than 170 countries. Its largest international operations are in Europe, Asia/Pacific, Latin America, and Canada. Smaller operations are in Africa and the Middle East.
The US accounted for 50% of the company's total revenues in 2012.
The company provides cleaning and sanitizing programs and products, equipment repair, and pest elimination for markets such as food service, food and beverage processing, healthcare, government and education, and textile care. Ecolab's chemicals and services are used in water treatment, pollution control, energy, steelmaking, papermaking, mining, and other industrial processes. It is also one of the top suppliers of chemical dishwashing products to institutions in the US.
Ecolab has six operating segments: U.S. Cleaning & Sanitizing (Institutional, Food & Beverage, Kay, Healthcare and Textile Care operating units); U.S. Other Services (Pest Elimination and Equipment Care operating units); International Cleaning, Sanitizing & Other Services;
Global Water (integrated global water treatment and process improvement offerings for industrial and institutional markets); Global Paper (process chemicals and water treatment for the global pulp and paper industry); Global Energy (process chemicals and water treatment needs of the global petroleum and petrochemical industries); and Corporate (amortization specifically from the Nalco merger intangible assets, merger integration costs and other investments).
Ecolab's revenues grew by 74% in 2012 as the result of the Nalco acquisition in 2011. Global Water segment revenues increased due to higher demand from the food and beverage, power, and primary metals industries (especially in the Americas and Asia/Pacific) offset by weak economic conditions and results in Europe, the Middle East, and Africa (EMEA). Global Energy segment revenues grew in 2012, reflecting strong volume growth in upstream businesses, especially in deepwater and shale plays.
The company reported $703.6 million in net income in 2012 (52% up on 2011) thanks to higher net sales and increased operating income outpacing a growth in expenses.
To keep costs in line with its continued investments, Ecolab has deployed a comprehensive plan to improve efficiencies. Part of the effort includes more shared and outsourced services, a centralization of business functions, and a realignment of the company's supply chain. Ecolab continued to trim its global workforce and office facilities following the merger of Nalco.
The company began a major financial restructuring of its European operations in 2011, expecting to save about $120 million over a three-year period. The plan includes changes to the division's supply chain, administrative operations, and other functions, as well as a 12% reduction in workforce. As a part of the restructuring, it rolled out its Ecolab Business System platform, a common set of business processes and systems, for its European operations. The EBS platform is designed to streamline the organization, improve efficiency and competitiveness, and more rapidly improve the region's profitability. Ecolab is also implementing EBS in China.
Sales and Marketing
The company serves customers in a range of segments including, Education, Facility Care, Food and Beverage Processing, Food Retail, Foodservice, Government, Healthcare, and Lodging.
The company grows through acquisitions. Following its acquisition of Nalco, Ecolab continued restructuring and cutting costs in early 2012, including cutting back on its global workforce and streamlining its supply chain. With the merging of both companies' operations, Ecolab emerged as a global leader in water, hygiene, and energy technologies and services. The company's global reach and expanded line of products and services will enable it to provide total water processing management to food and beverage, hospitality, and laundry customers worldwide. It continues to target key acquisitions to complement its businesses and to focus on key growth areas.
Ecolab's strategy for growth also includes investing organically in its businesses, including equipment used by customers to dispense its cleaning and sanitizing products, as well as in process control and monitoring equipment. The company also invests in innovation, such as a new R&D facility in Shanghai, China.
Mergers and Acquisitions
In 2013 Ecolab bought Houston-based Champion Technologies for $2.3 billion. The acquisition of Champion Technologies and its related company Corsicana Technologies (collectively referred to as Champion Technologies) helps Ecolab to boost its technology and product strengths in North America and is very complementary to its innovative technology and services in the offshore and international energy markets. The deal is expected to yield $150 million in cost synergies by the end of 2015.
In 2011 Ecolab acquired water treatment company Nalco in a $5.4 billion cash and stock deal. Ecolab is operating the Nalco business under three new segments: Water Services, Paper Services, and Energy Services.
In 2011 Ecolab completed its acquisition of O.R. Solutions, a privately held Virginia company that makes warming and cooling systems for surgical fluids, for $260 million. The business became part of the US Cleaning and Sanitizing segment.
Bill Gates and his wife own nearly 11% of Ecolab.