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Caraustar Shuts Richmond Mill, Idles Charlotte Plant

Dec. 11, 2008 - Caraustar Industries today said that it is permanently closing its Richmond Paperboard mill in Richmond, Virginia, effective December 11, 2008. About 52 salaried and hourly employees will be affected by the closure.

The Richmond mill is an uncoated recycled boxboard (URB) manufacturing facility with an annual capacity of 49,000 tons.

Associated with the closure, the Caraustar said it will record a pre-tax charge of approximately $5.9 million, of which approximately $4.7 million will be non-cash. The company expects to generate an estimated $5.1 million in annual pre-tax savings.

Caraustar said it will provide a comprehensive program of separation pay, benefits coverage and job assistance to mill employees.

Carolina Paperboard Mill
Caraustar also announced that effective December 19, 2008 it will idle the Carolina Paperboard mill in Charlotte, North Carolina. The mill is a URB manufacturing facility with annual capacity of 62,000 tons.

Caraustar said it will continue to monitor its product demand and expects to determine by the end of the first quarter 2009 when it will restart URB production at the Carolina mill.

"Recession and declines in product demand necessitate that the company move aggressively to retain cost efficiencies and increase capacity utilization across its mill system," said Greg Bartlett, vice president, sales Mill Group.

"Strategic capital investments have enhanced our mill system and allowed for this further consolidation. We value our customer relationships and will continue to supply all of their needs from other Caraustar mills," Bartlett said.

Caraustar Industries, Inc. is one of North America's largest integrated manufacturers of 100% recycled paperboard and converted paperboard products. The company serves the four principal recycled boxboard product end-use markets: tubes and cores; folding cartons; gypsum facing paper and specialty paperboard products.

SOURCE: Caraustar Industries, Inc.




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