Creve Coeur, Missouri, and Chicago, Illinois, USA, 17 October 2008 -- Smurfit-Stone Container Corporation (Nasdaq: SSCC) today announced plans to permanently cease production at its Pontiac pulp mill in Portage-du-Fort, Quebec, Canada. The closure of the mill is targeted for 31 October.
"The mill produces northern bleached hardwood kraft paper-grade pulp, which is not core to the company's transformation strategy. The rapidly deteriorating conditions in the pulp market necessitate that the company take prompt action to avoid cash losses," said Steve Klinger, Smurfit-Stone president and chief operating officer.
"This decision reflects the current pulp market and in no way reflects on the hard work and dedication of our employees at this mill," said Klinger. "It is our intent to work closely with government authorities, local communities, and unions as we make this transition."
The closure will result in a workforce reduction of 218 employees, with the company expecting to take restructuring charges in the fourth quarter 2008 totaling approximately USD 39 million, of which approximately USD 20 million is noncash. The closure will benefit cash flow in the fourth quarter.
Smurfit-Stone Container Corporation (Nasdaq: SSCC) is one of the industry's leading integrated containerboard and corrugated packaging producer and is one of the world's largest paper recyclers. The company is a member of the World Business Council for Sustainable Development, the Sustainable Forestry Initiative(R), and the Chicago Climate Exchange. Smurfit-Stone generated revenue of USD 7.4 billion in 2007, has led the industry in safety every year since 2001, and conducts its business in compliance with the environmental, health, and safety principles of the American Forest & Paper Association.