This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Xerium Technologies Comments On Press Reports Of Operational Restructuring Plans

Xerium Technologies, Inc. (NYSE: XRM), a leading global manufacturer of industrial textiles and rolls used primarily in the paper production process, today commented on a recent media report suggesting that the Company has finalized plans regarding possible restructuring opportunities and further that the Company will fund any such projects through an amendment to its credit facility. The Company wishes to clarify, however, that as of today and consistent with remarks made on its conference call on May 9, 2012, regarding its financial results for the first quarter, the Company has not finalized or committed to any such restructuring plans.

During the call held on May 9, 2012, the Company made reference to possible restructuring opportunities currently under review that are aimed at reducing the Company’s fixed costs, restoring historical gross margins and simplifying its business processes. The specific projects under consideration include, among other things, asset rationalizations, redeployment of assets across the Company’s platform and reductions in selling, general and administrative expenses.

The Company has preliminarily identified projects that, if implemented, would be expected to result in approximately $50 million of restructuring expenses over their period of implementation, of which net cash costs would be anticipated to be approximately $35 million. In addition, the Company would expect capital expenditures related to these initiatives of approximately $10 million, which would be incurred within its regular capital expenditure budget. The Company generally anticipates that it would fund the cash requirements of these restructurings from the free cash flow of its business as incurred, with specific funding arrangements to be determined as plans are finalized. Internal planning estimates suggest these initiatives, if fully implemented, could improve gross margins by approximately 200 to 300 basis points and operating income by up to $20 million annually.

The Company continues to explore fixed cost reduction opportunities, but the nature, magnitude and timing of any final plans may vary and will be subject to various factors including, but not limited to, global and regional market conditions in the paper industry, the projected costs and relative payback periods at the time of implementation, the potential impact on the Company’s highly trained workforce, compliance with all employee and governmental notice regulations and periods, and continued compliance with the Company’s credit facility. Should the Company decide to implement any such plans, management’s desire would be to conduct the projects in the most expeditious and orderly manner possible so as to deliver the bottom line improvements most rapidly while minimizing any potential disruptions to our global customers. In furtherance of this goal, the Company may consider, among other things, whether any amendment to its credit facility may facilitate the implementation of any proposed restructurings. Should the Company pursue any such amendment, the terms, timing and structure of any amendment will naturally depend on market conditions, and the amounts involved may or may not be material. Further, there can be no assurance that any restructuring will ultimately be pursued, that any amendment will be sought or obtained on terms acceptable to the Company, or that any restructuring, if pursued, will be successful.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,156.85 +24.88 0.15%
S&P 500 2,001.57 +2.59 0.13%
NASDAQ 4,562.1890 +9.43 0.21%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs