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Quanex's Corporate Responsibilty

In accordance with our CREED, we strive to make a positive impact on the world and to be a responsible corporate citizen everywhere we operate. Our research and development teams are continuously on the hunt for innovative products and practices, and we continually work toward potential improvements in all aspects of our business.

Environmental Stewardship

We take a further step to affirm our commitment to safety and environmental sustainability by maintaining a robust internal audit program. Audits are conducted periodically by a cross-functional team with representatives from both the legal and EHS departments, along with visiting auditors from a sister plant. In a typical year, the teams would visit six plants, which allows our larger plants to receive a visit approximately every 2-3 years. The audits focus not only on compliance issues, but also on best practices and opportunities for general improvement. The corrective actions growing out of each audit are then maintained in a proprietary task alert system, which allows for automated notification and tracking of required tasks, as well as automatic escalation to the Director of EHS and General Counsel of any overdue tasks.

In 2021, we formed new division-level ESG teams that will work together to develop various sustainability goals largely focused on improving our environmental stewardship efforts. As a first step, those new ESG teams have recently begun tracking our environmental footprint in a number of areas, including water usage, energy usage, hazardous waste. We plan to track these items on an ongoing basis and hope to use these new tracking processes to begin building credible and measurable information that will allow us to begin setting realistic and achievable goals in each of the noted areas. We plan to begin setting these more formal improvement goals and timelines as we move through fiscal 2022.

As we continue to build our tracking ability and begin setting formal goals, our ESG Teams are nonetheless working hard to improve our sustainability and reduce our overall environmental impact.

Waste Reduction

The teams are working on ways to reduce waste, so we can pass on savings to our customers. We continually look for waste reduction opportunities across the business, and 2021 was a successful year in this regard.

recycling In the U.K., we increased the use of recycling at our Coventry plant by 7.5%, including paper, cardboard, metal, and pallets. In addition, after re-designing our product reels for increased durability, we were able to re-use 76% of them. We collect empty reels from customers and are able to re-use them approximately ten times before they are worn out.
   
In our Kent, Washington facility, we completed a large extrusion line replacement project, which helped us improve delivery performance to our customers while reducing process scrap.
   
Our Heinsberg plant in Germany installed LED lights throughout the facility. These lights are more energy efficient than traditional fluorescent lighting and have the added benefit of simulating natural light and reducing employee fatigue.
   
Our Richmond, Kentucky facility was able to adjust a process for cleaning dies such that the facility is no longer a large quantity generator of hazardous waste as defined by the EPA.
   
We have also undertaken a Company-wide project to discover and develop new opportunities to continue reducing our waste, and to increase recycling. Over the next few months, we hope to develop metrics that will allow us to track current practices in a number of areas so that we can then begin to develop and implement various improvements.
   

NACC

During fiscal 2021, two of our Woodcraft facilities utilized an Ecogate system to improve efficiency of our dust collection systems and reduce electricity consumption. Our facility in Molalla, Oregon reduced its electricity usage by 854,951 kWh, effectively reducing its carbon footprint by 649 tons of Carbon Dioxide. Our Foreston, Minnesota facility installed the Ecogate system in 2021 and saw a reduction of 299,900 kWh of electricity, yielding a reduction of the Plant’s carbon emissions by 228 tons of Carbon Dioxide.

Mikron

Due to a recent capital investment in new extrusion lines, our Kent, Washington facility increased finished goods production in fiscal 2021 by 2.7 million pounds as compared to fiscal 2020 and reduced overall scrap year over year by 1.7 million pounds. This represented a 19% improvement. The addition of PVC fence production created an opportunity for Mikron to increase the amount of resin material recycled back into sellable products. The amount of internally recycled material in fiscal 2021 was 22 million pounds, or 90.4% of total scrap, versus 18.8 million pounds, or 76.7% of total scrap, in fiscal 2020.

On the energy reduction side, the new extrusion line project also resulted in reduced annual electricity usage to 1.7 million kilowatt hours. The Richmond, Kentucky facility upgraded a portion of its shop floor lighting from Fluorescent lighting to LED lighting during the year. Richmond replaced 62 Fluorescent light fixtures in the warehouse and production areas with 32 LED lighting fixtures.

On the water conservation front, the Kent facility completed a water savings project to begin recycling chilled water from the production line rather than discharging it to the sanitary sewer. This project allowed the facility to discontinue its wastewater permit altogether.

Insulated Glass Systems

Our IG Systems Plant in Cambridge, Ohio, recycled 622,447 pounds of material during the fiscal year, a 5.3% improvement over fiscal 2020. Through a variety of continuous improvement projects in each department, the facility has reduced the amount of internal hold scrap by 46% since 2020. In addition, the amount of material scrapped from production lines was reduced by 18%. The facility has also reduced the amount of waste going to the landfill by 19% for fiscal 2021.

Liniar

Overall waste was reduced by 10% in fiscal 2021 as compared to 2020, while recycling increased by 10% over prior year. The amount of regrind PVC used in new extrusions increased 3% over the previous year. This resulted in savings based on the price of PVC resin at the time of this report.

From an energy saving perspective, the Liniar operation converted three diesel fleet trucks to electric vehicles. The facility received a grant for £7,700 to install electric vehicle charging stations. Old lighting was replaced with new LED lighting throughout the facility and new energy efficient extruders and chillers were installed.

Edgetech UK and Europe

In fiscal 2021, our Coventry, England facility recycled 59.1 metric tons of plastic reels resulting in an improvement of 17% in plastic recycling. At the Coventry facility, 99% of waste is either recycled for in-plant use or sent to Refuse Derived Fuels for cement kilns.

On the energy savings side, passive infrared sensors were installed throughout the facility to keep lights off when nobody is in these areas. Timers were also installed to reduce temperature on extrusion equipment when not in use to reduce energy usage during weekends. The units are programmed to ramp up the temperature for production, as needed. Lighting in the production area, warehouse and outside the building was also converted to LED.

In Heinsberg, Germany the plant in fiscal 2021 saw a 20% increase in the number of plastic reels returned by customers for refurbish and reuse. LED lighting has been installed in the production areas and the office, and process improvements have allowed the facility to reduce scrap batch mixing time, both of which save electricity.

Homeshield/Screens

Our Homeshield division recycles all aluminum, steel, cardboard, and plastic scrap generated in its facilities. In 2021, Homeshield also piloted a cloth scrap reduction initiative in its Arlington, Texas plant, which resulted in a 6% reduction in waste for that plant alone. We plan to expand this initiative to other locations in 2022 and expect to see similar waste reductions in those plants.

Homeshield also made a number of LED lighting improvements at its facilities located in Rice Lake, Wisconsin; Fontana, California; Allentown, Pennsylvania; Sacramento, California; and Ankeny, Iowa. These improvements included the relocation of some operations to new sites with LED lighting and the replacement of some existing non-LED systems. In three of our locations, Homeshield is also utilizing low friction aluminum air lines to reduce the energy needed for compressed air.

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