In January 1902, Michigan played Stanford at the Rose Bowl in Pasadena, Calif. It was the first college bowl game. In April, Leon Serpollet set a new car land-speed record of 75.06 miles-per-hour. In August, Teddy Roosevelt was the first U.S. president to ride in an automobile.

That same year, Samuel L. Hirschey founded the Climax Incubator and Brooder Company in Castorland, N.Y. Hirschey had a patent on an incubator designed for the hatching of chickens, but soon found himself manufacturing cheese drums for local dairy producers and for florists throughout the Northeast. By 1904, when he incorporated Climax Manufacturing Co., the demand for packaging products outstripped the demand for hatching chickens.

Thus began the story of a North Country business, which today is a world-class manufacturer of folding cartons and recycled paperboard. 

“Climax produces boxes for Coach, Bloomingdale’s, Eddie Bauer, and Godiva just to name a few of their retail customers … If you buy any deli products at supermarket stores such as Walmart, Kroger, Wegmans, or Stop & Shop, you’ll walk out with a Climax package … When you open a pharmaceutical container and complain about the tamper-proof device covering the bottle, Climax produced the paper base … And while you are admiring the beautiful photo in your living room, the special matte paper probably came from the Climax Paperboard company,” says Patrick J. Purdy, CEO of Climax.

Samuel Hirschey’s dream lives on but is no longer guided by the family. The third generation sold Climax Manufacturing Co. in May 2008 in a stock deal to an investor group headed by Delta Point Capital Management, LLC of Rochester, a private-equity fund manager. The buyers formed Climax, LLC. Co-investors included Hamilton Lane, headquartered near Philadelphia with approximately $23 billion in discretionary assets under management along with oversight of an additional 

$135 billion in advisory assets (March 31, 2012) and NewSpring Capital of Radnor, Pa., which provided $5 million of mezzanine financing. Hamilton Lane invested funds provided by the New York State Common Retirement Fund. Key corporate managers have also made investments in Climax.

Climax, LLC then bought the assets of the St. Joseph Packaging company in St. Joseph, Mo. in November 2009 and certain assets of the Brownville Paper Company near Watertown. 

Today, the business has three operating corporations: Climax Paperboard, Inc. in Carthage; Climax Manufacturing Company, which makes up the original packaging business, in Lowville; and Climax Packaging, Inc. in Missouri. The fourth corporation is the holding company, Climax Acquisition, Inc. The six board members of the holding company include George Yancey, Samuel Villanti, Thomas Merkel, David Waterman of Delta Point, David Helgerson of Hamilton Lane, and Pat Purdy.

Company’s growth stats

According to Purdy, “The businesses generate $100 million annually in revenue, $40 million from papermaking and 

$60 million from packaging. The paper business has three different product lines: matte board, which produces $10 million annually, cap-closure, which is approaching $10 million, and packaging board both for Climax Packaging and for outside customers, which generates $20 million in revenue. The packaging-business revenue is split approximately 55 percent from retail sales and the balance from deli and other sales.” Purdy says that “… today Climax has 350 employees. The paper mill employs 80, St. Joseph’s employs another 80, and the Lowville [packaging] operation nearly 200.”

Climax owns the real estate both at the Lowville and Carthage sites. The former facility contains about 110,000 to 115,000 square feet of a converted shopping mall, while the latter encompasses 100,000 square feet of a mill built in the 1800s. Climax also rents warehousing space in Castorland and in Oswego and rents the real estate in Missouri. Climax sold off its fleet of trucks, and its only transportation asset is a small locomotive to move rail cars along its half-mile spur.

Purdy, a veteran of decades of employment in papermaking and packaging for Fortune 500 companies, came to Climax in 2004 at the request of the Hirschey family. The paper mill was losing $5 million annually. Purdy’s first assignment was to make the plant profitable. His second was to take over the reins as CEO. And the third was to prepare the business for sale. Today, “Climax Paperboard runs 24/7, closing only for holidays and for scheduled maintenance. We are at 100 percent of capacity and very profitable,” says Purdy, who also notes that the company ships product to more than 20 countries outside the U.S.

The packaging plant, which saw revenues drop 50 percent in the most recent recession, has rebounded to its pre-recession level of sales and profitability. 

“We still have unused capacity in Climax Manufacturing,” says Purdy. “Climax [Manufacturing] sells 95 percent of our product through direct-sales with the remaining 5 percent sold through a distributor network … We offer full-service packaging from creative design to printing, laminating, die-cutting, embossing, gluing, and folding, and our two locations give us access to new customers .. We are looking to grow by entering adjacent markets, such as the quick-food and beverage industries.”

When asked about the reasons for the company’s rebound, Purdy attributes it “… first to a focus on customer needs. Climax listens to its customers and follows industry trends closely … Second, we are responsive, creative, and concerned about maintaining the best quality in the industry … Third, we have a talented and dedicated work force. Many of our employees followed in the footsteps of their fathers, grandfathers, and even great-grandfathers.” 

All three plants are represented by unions. Two locals of the United Steel Workers represent the New York operations while the Teamsters Union represents the Missouri plant.

“To say this business is capital-intensive is an understatement,” quips Purdy. A tour of the New York plants reveals major investments in both plant and equipment, including millions of dollars to make the production process environmentally friendly. 

“Climax Paperboard captures 90 percent of its waste heat which is recycled to warm the water from the river to create the slurry which begins the papermaking process. The heat is originally generated from natural gas and hydro-electricity and our recycling of water limits our discharge … Almost all of our paperboard is made from 100 percent recycled fiber,” Purdy explains.

In addition to the CEO Purdy, the key management team includes Mark Godfrey, CFO and COO of Climax. Godfrey worked for major national corporations such as Rubbermaid and GE, before joining Delta Point as a turnaround specialist. Jill Boliver is vice president of administration; Michael Lambert is vice president of paperboard sales; Pete Dawes is vice president of sales, packaging; and plant managers are Walt Hovendon (Carthage), Dave Kisker (Lowville), and Kerry Stadel (St. Joseph, Mo.). Also, Robyn Nortz joined Climax two years ago as the quality manager, a position she had held at DuPont.