IP to Close Three Mills
At the Mobile mill, all employees will be released, and the machines will be prepared for indefinite shutdown. At Courtland, a fiber line and related paper machine and pulp dryer will be idled. Four more efficient paper machines will continue to operate at Courtland.
At Lock Haven, all five machines will be shut down. Two small machines that produce specialty paper products will continue to operate until the technical products can be successfully re-qualified and transferred to another IP facility.
The Camden mill, which makes unbleached Kraft and multi-wall paper, is being closed due to the decline of the Kraft paper market, excess capacity within International Paper's Kraft and containerboard system, and shrinking customer demand. Three machines will be shut down. Moving the unbleached Kraft paper production from Camden to mills at Savannah, GA, and Roanoke Rapids, NC, effectively removes 230,000 tons of the company's U.S. containerboard capacity and 50,000 tons of unbleached Kraft paper.
At the conclusion of the rationalization program, International Paper will have approximately 3.9 million tons in U.S. uncoated papers production capacity, 1.3 million tons in North American market pulp capacity and 4.7 million tons of U.S. containerboard capacity.
"Our actions will improve our earnings and ROI," points out John Faraci, executive vice president and CFO of International Paper. "This plan will improve our EBIT on an annual basis by more than $100 million vs. third quarter 2000, during which we took substantial downtime resulting in significant inefficiencies. We can improve the competitive position of our North American paper assets, sharpen our business focus and improve our profitability. Future capital expenditures will also be reduced as a result of these actions."