One year later, In-Situ awash in expectations

FORT COLLINS – In the year since In-Situ Inc. opened its doors in Fort Collins, the maker of water-monitoring instruments has itself been subject to closer observation.

In-Situ agreed to move to Fort Collins from its original home in Laramie, Wyo., with the help of $288,000 in state and local incentive grants. The red carpet treatment was unrolled as a means to entice In-Situ and its 65-person payroll to move south.

But the grant money isn’t free. The carrot for In-Situ is the creation of new jobs – the grant will release $2,000 for each new job added after the Aug. 31, 2004, opening. Economic development officials are hopeful that In-Situ can add 100 jobs over its first five years in Fort Collins.

To date, In-Situ appears to be holding up its end. The company’s first commitment was to add 10 new jobs by the end of 2005.

“We met that by the end of October (2004),´ said Bob Blythe, In-Situ’s president and CEO.

The company continues to grow, although Blythe won’t divulge the company’s total headcount, which he contends would tip off competitors to its revenue. And revenue figures, Blythe said, would offer too much insight about In-Situ’s business plan as deep-pocketed rivals like General Electric Co., Siemens, Teledyne Inc., Tyco International and Danaher Corp., look to expand their own water instrumentation divisions.

Still, Blythe acknowledges that In-Situ’s enjoyed “significant double-digit growth” on its top line in 2004, and expects similar gains this year. The company’s also investing heavily in research and development of new products.

“In the last 18 months we have more than doubled our expenditures on R&D,´ said Blythe, who joined the company in June 2003 after leaving Loveland-based Hach Co., a subsidiary of Danaher.

In-Situ is part of a burgeoning water instrument industry, a market that’s estimated to be worth $400 billion worldwide. A recent article in the Wall Street Journal reported that General Electric has invested $3.2 billion in its water business over the past three years, including a $1.1 billion purchase of Ionics Inc., which makes water treatment technology. Water industry stocks increased 24 percent in 2004, and 113 percent over the previous five years.

Water-related products could become even more attractive in the near future. The Journal article cited a report by the World Commission on Water for the 21st Century, which said water use is expected to increase 50 percent over the next 30 years.

Blythe acknowledges that In-Situ Inc. has been targeted for acquisition in the last six months “by well-known public companies,” but continues to resist such offers.

The company might have established its sense of self-determination earlier this year when it issued a news release in March, in which Blythe said, “Disciplined re-investment in research and process improvement continues to pay off as our company has recently seen record increases for both revenue and net profit.”

In-Situ would seem to have plenty of reasons to keep going solo.

Its products, which monitor the levels and quality of water sources – lakes, rivers and aquifers – are in high demand, particularly among countries that are industrializing at a rapid rate.

In-Situ has monitors in place in India, for instance, which is dire need of potable water sources to support its growing economy, Blythe said. Other locations include the Aswan Dam in Egypt, mines in Latin America and nuclear waste disposal sites in Europe as well as the Untied States. In all, In-Situ’s conducting business in 70 countries.

Blythe said the company is considering setting up an international office to provide service and support closer to some of those customers, but that all manufacturing would remain in Fort Collins.

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