Clearwater Paper Corporation (NYSE:CLW) today announced the permanent and immediate closure of its Long Island, N.Y., tissue converting and distribution facility. “After thoughtful consideration, we have determined that permanently closing our Long Island plant and consolidating manufacturing at the company’s other lower-cost tissue facilities is a necessary step for Clearwater Paper,” said Tom Colgrove, president of the company’s consumer products division. “This has been a tough decision, one where we carefully reviewed all alternatives to closing the plant.” The company will work closely with the New York Department of Labor’s Rapid Response Unit to assist employees in receiving training or educational benefits or other benefits that enable them to find new employment as quickly as possible. The company will also provide career assistance services to help employees through this difficult time. Displaced employees will have the opportunity to apply for open positions at other Clearwater Paper facilities. In addition, employees will be offered separation pay. The company expects the total impact of non-recurring exit related costs to be approximately $12-$15 million, of which approximately $10 million is expected to be incurred in 2014 and the remainder in 2015. The cost savings benefits resulting from the facility consolidation and optimization, which are incremental to the company’s previously announced cost savings programs, are expected to be approximately $6 million in operating costs savings in 2014 and approximately $12 million on an annual basis to be fully realized beginning in the first quarter of 2015. “Clearwater Paper wants to ensure we are doing as much as we can to help the 155 affected Long Island employees through this difficult time,” said Colgrove. “We are working with local and state agencies plus a private job transitional service to supply multiple job options to the employees.” ABOUT CLEARWATER PAPER Clearwater Paper manufactures quality consumer tissue, away-from-home tissue, parent roll tissue, machine glazed tissue, bleached paperboard and pulp at 14 manufacturing locations in the U.S. and Canada. The company is a premier supplier of private label tissue to major retailers and wholesale distributors. This includes grocery, drug, mass merchants and discount stores. The company also produces bleached paperboard used by quality-conscious printers and packaging converters. Clearwater Paper's employees build shareholder value by developing strong customer relationships through quality and service.
FORWARD-LOOKING STATEMENTSThis press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as amended, including statements regarding the timing of the closure of the Long Island facility, the costs and timing of those costs associated with the closure of the Long Island facility and the cost savings benefits and timing of those benefits associated with the consolidation and optimization of manufacturing facilities. These forward-looking statements are based on current expectations, estimates, assumptions and projections that are subject to change, and actual results may differ materially from the forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, risks and uncertainties arising from the possibility that the closure of the facility may be delayed or may not occur; difficulties with the relocation and optimization of manufacturing equipment; manufacturing or operating disruptions, including equipment malfunction and damage to the company’s facilities; competitive pricing pressures for the company's products, including as a result of increased capacity as additional manufacturing facilities are operated by the company's competitors; changes in the cost and availability of wood fiber and wood pulp; changes in transportation costs and disruptions in transportation services; labor disruptions; changes in costs for and availability of packaging supplies, chemicals, energy and maintenance and repairs; changes in customer product preferences and competitors' product offerings; changes in the U.S. and international economies and in general economic conditions in the regions and industries in which the company operates; and other risks and uncertainties described from time to time in the company's public filings with the Securities and Exchange Commission. The forward-looking statements are made as of the date of this press release and the company does not undertake to update any forward-looking statements.