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[March 2006]
Jacuzzi Brands Announces UK Bath Products Plant Consolidation
Jacuzzi Brands Inc (West Palm Beach, FL, USA) has announced that it plans to consolidate its Bradford, West Yorks, England ceramics production into its Newcastle-under-Lyme, Staffs facility and its outsourcing partners. The Bradford facilities manufacture bath products including shower enclosures, sanitaryware and acrylic baths.This action, which was not included in the company's previously issued earnings guidance for fiscal 2006, is part of Jacuzzi Brands' ongoing initiatives to improve the overall operating performance of its Bath Products business segment to meet its long term operating goals. The company said it did not anticipate any customer service disruptions during this period.
The company further stated that the costs of this consolidation were expected to approximate US$3.1 million or US$0.02 per share, including US$1.3 million for anticipated severance and other cash expenses to be classified as restructuring and US$1.3 million in accelerated depreciation and US$0.5 million in inventory write-offs to be included in cost of goods sold.
These non-recurring charges will be taken during the second, third and fourth quarters of fiscal 2006. Management plans to complete this plant consolidation and integration by fiscal year end. This action is not
expected to have any effect on the company's operating income in fiscal 2006 after excluding the non-recurring charges but is expected to improve operating income beginning in fiscal 2007 by approximately US$3.0 million per year. Jacuzzi Brands said that approximately 100 employees would be affected by this action.Al Marini, President and Chief Operating Officer of Jacuzzi Brands Inc, said: "Jacuzzi Brands is committed to delivering maximum value to shareholders, while at the same time delivering excellent design and quality
to our customers. While we regret the disruption to the Bradford workforce, this consolidation is part of our ongoing plan to remain competitive in the market place, improve efficiencies, and mitigate the impact of rising raw material and energy costs."www.jacuzzibrands.com
ENDS