SCA, the Swedish paper-product company, has announced that it is closing its US tissue production plant in Flagstaff, Arizona.
The decision was made to ‘further improve efficiency and strengthen the competitiveness for the professional hygiene business in North America’.
The closure is part of the company’s strategy to ‘optimise the geographic production footprint to drive cost and capital efficiency, and further increase value creation in the professional hygiene business area’.
The Flagstaff tissue production plant has an annual capacity of 55,000 tonnes for the professional hygiene business. Production will be discontinued in June 2017.
Restructuring costs amount to SEK 250 million (€25 million), and will be recognised as an item affecting comparability to be taken in the second quarter of 2017. SCA reports that approximately SEK 40 million (€4 million) of these costs are expected to impact cash flow.
SCA recently announced that it is increasing its ongoing expansion project at the Östrand pulp mill. The company invested €800 million in the mill, which is planned to start production in June 2018.
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Aidan O’Sullivan. Click subscribe to sign up to ESM: The European Supermarket Magazine.