Catalyst Paper to Trim Newsprint Capacity, Jobs
May 30, 2007 (Press Release) - Catalyst Paper announced a series of initiatives today in a continuing drive to reduce costs and improve profitability. They include:
- Indefinite curtailment of one paper machine effective September 1, 2007
- Elimination of 130 support positions bringing the overall workforce
reduction to 480 in 2007
- Relocation of the corporate office from Vancouver to Richmond
- Centralization of some mill and corporate administrative functions in
An $8 million improvement in annual profitability is expected from the indefinite closure of the Port Alberni Division's # 4 paper machine. This will displace 134,000 tonnes of the company's least profitable newsprint business, reduce its highest cost fibre requirements and result in the layoff of 185 staff and hourly employees additional to the workforce reductions announced. Lightweight coated and directory capacity will remain unchanged.
The overhaul of corporate structure, involving reduction of 130 support positions, centralization of functions and office moves, is expected to deliver annual savings of $16 million with one-time costs of $19 million.
"Reducing costs is an immediate priority given the high Canadian dollar and the decline in North American newsprint consumption," said Richard Garneau, president and chief executive officer. "While we regret the strain these cost-saving measures will place on the employees involved, they are necessary to the long term success of our business and our position in key market segments."
SOURCE: Catalyst Paper