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Graphic Packaging to Temporarily Cease Production of Coated Unbleached Kraft
Marietta, Georgia, USA, 20 June 2008 -- /PRNewswire/ -- Graphic Packaging International Inc., a subsidiary of Graphic Packaging Holding Company(NYSE: GPK), today announced that, in response to sharp cost increases for mill inputs such as fiber, energy, and chemicals, the company plans to temporarily shut down its No. 2 coated board machine at its West Monroe, Louisiana, mill. The No. 2 paper machine at West Monroe produces approximately 100,000 tons of coated unbleached kraft (CUK) annually, which is primarily used in the production of beverage cartons.

"The recent run up in the price of crude oil has translated into higher costs for key mill production inputs like fiber, natural gas, and petro-based chemicals," said David W. Scheible, president and chief executive officer. "In response, we are undertaking various actions to offset those increases that include idling certain older, higher-cost assets. The decision to temporarily suspend production from machine No. 2 will help streamline our cost structure, while customer orders will continue to be fully met by using production from our other, lower-cost CUK machines."

Scheible continued, "Due to the escalating costs and broader inflationary concerns, we are making these necessary adjustments to our operating structure. In addition to the actions we are enacting at our West Monroe mill, we have also determined it is necessary to implement price increases and renegotiate freight and delivery charges. Although Graphic Packaging has a strong reputation for low-cost manufacturing, these actions are necessary for us to remain competitive and to continue providing high-quality, innovative packaging to our customers, while also generating positive returns for our shareholders."

Graphic Packaging International, Inc., a subsidiary of Graphic Packaging Holding Company (NYSE: GPK), headquartered in Marietta, Georgia, is a leading provider of packaging solutions for a wide variety of products to food, beverage, and other consumer products companies. The company is one of the largest producers of folding cartons and holds a leading market position in coated-recycled boxboard and specialty bag packaging. The company's customers include some of the most widely recognized companies in the world. Additional information about Graphic Packaging, its business, and its products is available at www.graphicpkg.com.

Source: Graphic Packaging International Inc.

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