23rd Aug 2006 07:01
Smith (DS) PLC23 August 2006 23 August 2006 DS Smith Plc Sale of Taplow Site and Proposed Closure of Taplow Mill DS Smith Plc (SMDS), the international packaging manufacturer and officeproducts wholesaler, announces further progress in the strategic rationalisationof its UK Paper and Corrugated operations. DS Smith has sold its site at Taplownear Maidenhead, Berkshire to Towntalk Limited, a commercial property developer,for a cash consideration of £30.25 million and announces the proposed closure ofits Taplow Mill. Taplow Mill, which currently manufactures 95,000 tonnes per annum of corrugatedcase material (CCM), has been adversely affected by difficult market conditionsand substantial increases in energy costs. It made losses in financial year2005/06 and is not expected to return to adequate profitability. Consultationwill commence immediately with the Mill's 85 employees, with a view tomitigating the effects of the proposed closure. It is proposed that the closureof the Mill will be implemented by the end of October 2006. The Group'sSevernside waste collection depot, which also operates on the Taplow site, willbe relocated. The consideration for the sale of the site will result in an exceptional profitin the current financial year of £20.7 million, net of the book value of thesite of £9.0 million and related disposal costs. It is also estimated that theproposed closure and relocation will result in an exceptional charge to theprofit and loss account in the current financial year of the order of £12million; approximately one third of which will be cash costs and the remainderwill be the write-down of assets. The proposed closure of Taplow Mill is another important step towards raisingthe returns of the Group's Paper operations. Following the proposed closure ofTaplow Mill, St Regis' principal mill at Kemsley will represent approximately70% of the division's output of over 840,000 tonnes per annum of paper; KemsleyMill is ranked in the top quartile of European CCM mills in terms ofcompetitiveness. Enquiries: DS Smith Plc 020 7932 5000Tony Thorne, Group Chief ExecutiveGavin Morris, Group Finance DirectorPeter Aubusson, Group Communications Manager Financial Dynamics 020 7269 7291Richard Mountain/Susanne Walker NOTES TO EDITORS DS Smith's UK Paper division, St Regis, currently has five mills and is theleading UK producer of recycled paper. Approximately 70% of the paper itproduces is used in the construction of corrugated boxes and trays, theremainder being plasterboard liner and other speciality paper grades. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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