As a result of these measures, Fiberweb’s spunbond capacity in Europe will remain broadly constant and average capacity per line will increase by around 50% compared to first half 2008, with a significant improvement in competitiveness.
Fiberweb will also close a non-competitive airlaid line in Peregallo di Lesmo, Italy. The line was installed alongside laminate production line in 2006; however, during the past year it has suffered from significantly higher than expected operating costs as well as technical problems that have prevented it from reaching planned levels of output. As a result, this plant is unviable and will be closed immediately. Fiberweb’s primary airlaid business in China is unaffected by this decision.
It is anticipated that around 150 employees will be affected by these closures, which are essential to the continuing improvement of Fiberweb’s overall competitive position.
As a result of these initiatives, Fiberweb now expects to incur cash restructuring costs in 2009 of £12 million with anticipated savings from 2010 onwards of at least £7.5 million per year beginning in 2010. Non-cash restructuring charges associated with these closures are estimated to be £24 million and have been taken during the second-half of 2008.
Fiberweb’s 2008 full-year results will be announced on February 25, 2009.