Buckeye Technologies to Shut Down Nonwovens Facility by 2012 End

Published on June 20, 2011 at 1:15 AM

By Cameron Chai

Buckeye Technologies, a producer and supplier of nonwoven materials and specialty fibers, declared that it intends to shut down its airlaid nonwovens plant located in Delta, British Colombia, Canada, by the end of fiscal year 2012.

Buckeye Technologies will use its facilities in Steinfurt, Germany, and Gaston County, North Carolina, to produce goods now manufactured at Delta. According to John B. Crowe, Chairman of Buckeye, the facility’s low utilization of capacity, a strong Canadian dollar and poor site locality concerning raw material suppliers and customers are the some of the reasons behind the closure of the facility.

Crowe continued that the company combined its two-machine production into one airlaid machine operation in fall 2010 in order to increase the profit of the facility. However, the facility’s financial performance forecast is not in a good shape even after the consolidation, he added.

Crowe further said that the 18-month schedule for closure will provide the time to execute the required alterations at Buckeye’s Steinfurt and Gaston facilities to fulfill the demands of its Delta customers. The closing and consolidation of operations will enhance capacity utilization, profit and return on investment for the company’s nonwoven business. Nearly $30 million in cash is estimated to be generated from the closure, mainly through disposal of assets of the Delta facility and decreasing the working capital, he said.

Source: http://www.bkitech.com

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