Wausau's announcement reflects the outcome of a strategic review of alternatives for the Print & Color business, begun early in 2011. President and CEO Thomas J. Howatt said "I wish to express my sincere gratitude to our Print & Color employees for their unceasing efforts to reengineer and sustain this business. Our decision to exit Print & Color was ultimately driven by dramatic and irreversible market demand decline and the need for consolidation to bring these markets properly into balance.
"While the effort to secure a buyer for the mill was unsuccessful," Howatt continued, "employees of the Print & Color business have done all that has been asked and this closure is in no way a reflection of their skill, talents, or determination to return this business to acceptable levels of profitability."
Anticipated after-tax closure-related costs and impairment charges, net of proceeds from the premium brand sale, are expected to total approximately $49 million, or $1.00 per diluted share, including after-tax non-cash charges of $45 million, or $0.92 per diluted share. In the fourth quarter of 2011, after-tax charges are expected to be approximately $49 million, or $0.99 per diluted share, with non-cash charges totaling approximately $48 million, or $0.96 per diluted share, including approximately $38 million, or $0.78 per diluted share, related to the impairment charge on mill assets.
Remaining closure-related charges, net of the proceeds from the premium brand sale, will be recognized during 2012. Sales proceeds and liquidation of working capital, net of closure costs, are expected to generate estimated cash flows of approximately $20 million in 2012. Closure of the Brokaw mill is expected to be accretive to both operating earnings and EBITDA on an annual basis.
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