Packaging
Ball to Consolidate 12-Ounce Can Capacity, Realign North American Manufacturing Footprint to Meet Customer Demand
Thursday 27. January 2011 - Ball is optimizing its North American beverage can manufacturing footprint to meet changing customer demand
Highlights
– Ball is optimizing its North American beverage can manufacturing footprint to meet changing customer demand
– The company’s Torrance, Calif., plant will cease production by the end of the third quarter of 2011
– Ball expects to record a total after-tax charge of $12.4 million in 2011 related to the plant closing
– The closing is expected to be cash flow positive upon final disposition of all assets
– A 12-ounce can production line will be relocated from Torrance to Ball’s Whitby, Ontario, plant
– Ball is expanding specialty can production in its Fort Worth, Texas, plant
– These actions better align Ball’s manufacturing footprint with demand and increase operational efficiencies
BROOMFIELD, Colo., Jan. 25, 2011 /PRNewswire via COMTEX/ —
Ball Corporation (NYSE: BLL) announced today several actions to decrease the company’s overall installed beverage can capacity in North America while better aligning Ball’s manufacturing footprint to meet changing customer demand.
Ball will close its Torrance, Calif., beverage can plant by the end of the third quarter of 2011, subject to customer requirements. The 45-year-old plant employs approximately 120 people and operates three lines, two that produce 12-ounce cans and one that produces 16-ounce cans. One of the 12-ounce production lines from Torrance will be relocated to Ball’s Whitby, Ontario, beverage can plant and is scheduled to start up during the second quarter of 2011.
Ball expects to record a total after-tax charge of approximately $12.4 million in 2011, primarily for employee severance and pensions and facility clean-up costs, of which $6.4 million is expected to be recorded in the first quarter of 2011. The closure is expected to be cash flow positive to Ball upon final settlement of all closure-related costs and disposition of all assets and will result in significant fixed cost savings to the company.
Ball, the largest producer of specialty beverage cans in North America, will also expand specialty beverage can production in its Fort Worth, Texas, plant. Ball supplies to its customers beverage cans in more than 20 sizes as well as other beverage can innovations. A new line in Fort Worth will make 16- and 24-ounce specialty cans and is expected to begin production by the beginning of the third quarter of 2011.
“These actions support our strategy of growing Ball’s beverage can business while better aligning our manufacturing footprint with changing market demand and increasing operational efficiencies,” said Raymond J. Seabrook, executive vice president and chief operating officer, global packaging. “The strong demand for specialty cans, especially for beer, teas, energy drinks and other beverages, continues to drive volume for Ball. The output of the Whitby and Fort Worth lines is contracted to customers under multi-year agreements.”
Torrance employees will be provided severance and outplacement services, and will be able to apply for open positions within Ball.