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PGI To Shutter Two U.S. Plants

January 4, 2007

In an effort to lower operating costs and improve its performance, Polymer Group Inc. will close plants in Rogers, AK and Gainseville, GA and transfers portions of its business to other locations in North America and Asia. Operations at the two plants are expected to be completely phased out by mid-year. PGI’s interim CEO William Hewitt said the consolidation is necessary for the company to maintain its competitiveness in the U.S. market. “The steps we are taking will result in an improved cost structure and make PGI a stronger company going forward,” he said. “We deeply regret the impact these difficult actions will have on our employees but they are necessary to achieve our profit targets in an increasingly competitive global market.”

"PGI was built through a series of acquisitions and this resulted in a big footprint with seven operations in U.S.," said vice president of strategic planning and communication Dennis Norman. "The consolidation made sense from an efficiency point of view."
PGI’s thermal and adhesive bonding business will be transferred from Rogers to Landisville, NJ while the manufacturing of spunlace fabrics for wipes currently located in Rogers will be moved to PGI’s facilities in North Little Rock, AK and Benson, NC. The Rogers plant, which was started up by Scott Paper in 1974 and purchased by PGI in 1992, has about 120 workers.
Additionally, PGI will relocate is medical fabric finishing operation from Gainesville to Suzhou, China, where it recently installed a state-of-the-art finishing line. Meanwhile, manufacture of PGI’s Reticulon apertured film for feminine hygiene applications will be transferred from Gainesville to PGI’s Bonlam site in San Luis Potosi, Mexico. The move will also allow PGI to expand capabilities in Mexico to produce laminated cloth-like backsheets for diapers.
After the consolidation, PGI will operate five U.S. plants—-Benson and Mooresville, NC; Landisville, NJ; North Little Rock, AK and Waynesboro, VA. PGI expects to incur $5.5-6 million in cast restructuring charges as well as the non-cash write-off of assets valued at $1.4 million. Once complete, the plan will reduce cash fixed costs by $4-6 million. Additionally, PGI anticipates it will reap $4.5-6 million one the sale of idled facilities and equipment.

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