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[December 2008]
Syracuse China Dinnerware Factory to Close Down in Months
Libbey Inc (Toledo, OH, USA) revealed on 9 December 2008 that it plans to permanently close its Syracuse China ceramic dinnerware factory in Syracuse, New York, as part of its ongoing effort to improve its cost structure and operating efficiency. The closure is currently planned to be complete on or about 27 March 2009. The Syracuse facility currently employs approximately 275 people.
Chairman and CEO John Meier said: "For our customers, we expect to minimise the effects of this decision by continuing to service the North American foodservice dinnerware market with imported dinnerware under both the Syracuse China and World Tableware brands. While considerable efforts have been made at Syracuse China to reduce costs, the operations continue to fall short of our strategic expectations. This restructuring of Syracuse China will improve Libbey's competitiveness in 2009 and beyond".
In another action to reduce costs, Libbey announced that it plans to close its Mira Loma, California glassware distribution centre, which employs approximately 30 people, in May 2009 and not renew its lease that expires in June 2009. Customers who are currently serviced by the Mira Loma facility will be serviced by one of Libbey's other North American distribution centres.
The company is currently assessing the associated special charges as a result of these closures, the majority of which it expects to be non-cash and to be recorded in the fourth quarter of 2008.
Libbey previously announced that it had identified US$20 million to US$23 million of cash flow enhancements that it expected to achieve in 2009. These include a number of cost-reduction initiatives throughout the company, led by capital expenditure reductions of US$12 million to US$14 million. The closures of the Syracuse China and Mira Loma facilities were not included in the previously announced cash flow enhancements and are expected to add an additional US$4 million to US$5 million to cash flow on an annual basis, excluding any one-time special charges.
ENDS