PolyOne Realigns Manufacturing Assets to Enhance Competitiveness and Supply Chain Efficiency
As a next step in its strategic transformation, PolyOne Corporation announced that it is realigning certain of its manufacturing assets, primarily in North America. The decision to realign assets is a result of the Company's ongoing focus on both the operational excellence and specialization components of its transformation strategy. This realignment is designed to enable the Company to improve the competitiveness of its operations and supply chain across many platforms and businesses, consistent with current and anticipated customer requirements. The impact of these actions will be to enhance the Company's long-term performance, while helping to mitigate the effects of the current economic downturn and the increases in raw material and energy costs.
Over the next nine months, the Company will close certain production facilities, including seven in North America, and one in the United Kingdom, resulting in a net reduction of approximately 150 positions. Production at the affected facilities, as well as several manufacturing lines, will be moved to a limited number of the Company's more than 30 remaining plants. PolyOne expects no disruption of service, due to the Company's focus on improved product delivery systems and inventory management.
As a result of these actions, PolyOne expects to incur one-time charges of approximately $31 million, of which approximately $18 million are expected to be non-cash. These one-time charges will include costs related to severance and asset write-downs, which will be included in the Company's financial results over the next three quarters. The Company also expects to invest approximately $12 million in additional capital expenditures at its remaining locations to support these changes. The Company expects these actions to generate pre-tax savings of $17 million ($0.12 per share after tax), on an annualized basis.
Other news from the department business & finance
