Carbon dioxide (CO2) has been an important commodity over the past year for its role not only in storing and distributing the coronavirus vaccine, but also for perishable foods amid a growth in popularity of home delivery. Distributors like American Welding & Gas, Inc. (AWG) have been at the forefront of ensuring pharmaceutical, logistics and food companies are stocked with product. Jason Krieger, President and CEO of Raleigh, North Carolina-based AWG, explained to gasworld how it has been supplying dry ice to vaccine manufacturers, shippers, hospitals, vaccination centres, and pharmacies, as well as installing CO2 bulk tanks in what has been a record year for the company.
Did AWG install a 50-tonne CO2 storage unit in Kentucky that will support the covid vaccine distribution?
Jason Krieger (JK): We did. That installation was one of the first large scale partnerships for the support and distribution of the vaccine in the US. AWG has a strong, long-term commitment to CO2 and we were honored to earn this opportunity.
Have you seen increased dry ice demand just from the vaccine, or has food home delivery also been a growing trend?
JK: Outside of the vaccine, we have seen strong demand in dry ice used for shipping requirements for food and perishables and we do expect this to continue.
Have different vaccine rollouts in states made meeting demand for dry ice more challenging for you, and do you expect demand to continue to be high for the rest of the year?
JK: AWG operates 80 locations in 20 states stretching from Montana to Florida. Our long reach helped us in many cases. Like our example in Kentucky, we have been able to partner with customers with significant volume requirements for the vaccine in North Dakota, Minnesota and Illinois. Having our cryogenic technicians, distribution fleet and bulk tank assets strategically located across our service area allowed us to respond quickly and professionally to the numerous inquiries we received from the public and private entities involved in this essential project. That said, we do expect any easing of Covid-related CO2 needs to be offset by a significant summer demand in other segments.
The US Food & Drug Administration (FDA) approved Pfizer-BioNTech’s request to store their Covid-19 vaccine at standard freezer temperatures instead of in ultra-cold conditions – how does this impact AWG?
JK: We expect it to tamper consumption to some degree. However, the distribution companies that now ship the vaccines with dry ice previously purchased dry ice. They are now using the new CO2 supply to produce their own requirements.
How has the acquisition of Bestway Welding Supply increased AWG’s capabilities?
JK: First and foremost, we have a wonderful group of teammates that have joined the AWG family. We are very thankful for them. Second, BWS was built on a strong microbulk platform and that gas focus provides us a strong foundation for our future growth in Texas.
Which products and services have performed well over the past year, what is driving this?
JK: While the Covid environment was challenging, we actually became more opportunistic and aggressive than we have ever been. We had record bulk installations. Specialty gas performed well and we are thankful for our distributor partners who rely on us for their high end specialty gas needs. Our CO2 Air business, which has a versatile gas model, allowed us to overcome a very volatile CO2 summer. All of this, coupled with strong acquisition performance, drove a record year for us in all categories. We chose to take complete ownership of our position within the pandemic. It wasn’t easy but our teams stepped up more than ever. I am very proud of them.
What challenges has Covid presented AWG, and how have you overcome them?
JK: Making sure that our teammates and their families were safe at all times was our focus throughout Covid and with that, we also took the time to formally recognize many of them for their leadership and hard work. Likewise, our professional drivers always have one the hardest jobs in our business. Their ability to perform safely while continuing to be a face of the organization during a pandemic has been remarkable.
What will 2021 bring for AWG? Do you anticipate more acquisitions?
JK: We will have strong carryover from this year’s performance. The economy is improving. We are staying close to any government policy change and how that will impact us. For acquisitions, AWG is open to exploring any opportunities that may be presented to us. While we are very well capitalised, we are very disciplined in our approach. We are focused on owners who seek two things: the best home for their people and customers and a partner who genuinely wants to protect their family’s legacy. For those owners, we strongly believe we are their best choice when compared to a major or private equity.
Generally, do you see more consolidation in the industry over the next year?
JK: Yes. There is a lot of money on the side-line that we feel will come into play. The multi-national corporations and private equity will be engaged. Owners who are planning for tax challenges that lie ahead may be actively investigating their options. We look forward to being a part of it.