WestRock Co., Atlanta, has announced that it is reconfiguring its North Charleston, South Carolina, paper mill to improve the mill’s operating efficiency and long-term competitiveness. As part of the reconfiguration, WestRock will permanently shut down one of the mill’s three paper machines and related physical infrastructure, eliminating about 288,000 tons of linerboard capacity, WestRock reports in a news release.
The reconfigured mill’s production capacity will total 605,000 tons per year, consisting of three grades: kraft linerboard; KraftPak, an unbleached folding carton kraft paper; and DuraSob, a saturating kraft paper used for decorative laminate and industrial end uses.
“The actions that we are taking at our North Charleston mill will substantially improve the long-term competitiveness of the mill by reducing our ongoing operating costs and capital needs and focusing more than half of the mill’s production on the high-value, differentiated DuraSorb and KraftPak products,” says Steve Voorhees, chief executive officer of WestRock. “Reducing the production of linerboard at this mill will help balance our supply with customer demand across our system.”
According to the news release from WestRock, the company estimates that this reconfiguration will increase its earnings before interest, tax, depreciation and amortization (EBITDA) by about $40 million, primarily arising from the reduction in operating costs from the shutdown of the paper machine and its associated infrastructure. The reconfiguration also includes an anticipated workforce reduction of about 260 positions at the mill over a five-month period, starting in January 2020.
“We understand that this reconfiguration will impact our employees, their families and the community,” Voorhees adds. “Our teams are working to provide support and resources to our employees and their families as we move forward.”