SCA Invests in Efficiency Realignment of EU Tissue Production

 

To further improve efficiency and strengthen the competitiveness of its tissue operations, SCA (Stockholm, Sweden) has decided to implement restructuring measures at its production plants in Hondouville and Saint-Etienne-du-Rouvray, France, the company announced. The restructuring measures are aligned with the company’s strategy to improve production efficiency to drive cost and capital efficiency and further increase value creation in the tissue business area.

The restructuring measures include the closure of the oldest tissue machine in Hondouville and personnel reductions at Hondouville and Saint-Etienne-du-Rouvray. In Hondouville, where SCA manufactures away-from-home tissue, production will be concentrated to more efficient machines, thus enabling production levels to be maintained. In Saint-Etienne-du-Rouvray, SCA has decided to divest production of tabletop products for consumers to focus on the plant’s core operation--kitchen roll and toilet paper production. The measures will lead to lower production costs and increased competitiveness.

Total costs are expected to amount to approximately SEK 500 million, of which about SEK 470 million will be recognized as an item affecting comparability in the third quarter of 2016. The remaining costs will be recognized as an item affecting comparability in Q4 of 2016. Of these costs, approximately SEK 340 million is expected to affect cash flow.