Imerys Implements Plan to Reduce Costs in Georgia
August 15, 2001
Imerys Pigments and Additives Group recently announced that its restructuring initiative at the company's Georgia kaolin facilities, which began in fourth quarter 2000, was successfully implemented in the first and second quarter 2001. The restructuring initiative involved the shut down of 800,000 tons of paper grade kaolin capacity in Georgia. Although Imerys did not exit any specific kaolin product lines, the majority of tons removed from its operations were mature hydrous grade volumes that have experienced a decline in demand as the paper industry increases use of value-added kaolins and carbonates. Rich Ryan, senior vice president and general manager for the Americas Paper Division commented, "We set out to do something which hadn't been done before in the North American kaolin industry, namely shutting down significant capacity and eliminating the fixed costs associated with this capacity. We are pleased to report that through the diligent effort of our employees we accomplished our goals in the time frame set. At the same time, we successfully implemented an across the board price increase on all paper grades of kaolin. The price increase and the cost reduction measures were initial steps toward restoring acceptable profitability to our Georgia kaolin to paper business. Unfortunately higher energy costs and poor market conditions offset much of the gain associated with these first initiatives."
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