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By Michael Lauzon
CORRESPONDENT
Published: July 18, 2013 4:00 pm ET
Myers Industries Inc. will close two plastics plants and open a new one in a restructuring program for its lawn and garden segment.
Slated for shutdown are production plants in Waco, Texas, and Brantford, Ontario. A new plant will open in Sparks, Nevada, the Akron, Ohio, firm announced July 18.
Myers spokeswoman Amanda Hoggarth said timings of the closures and startup “have not been determined yet.” However, the firm said in a financial news release that annual savings in the program of $8 million will begin to appear in the fourth quarter of 2013 with most of the savings realized throughout 2014 due to decreased labor, overhead, plant and freight costs.
Waco and Brantford make horticultural products and containers and employ 75 and 250, respectively. Hoggarth had no details of the Sparks plant.
“Today’s announced restructuring is phase two of our efforts towards increasing the value of the lawn and garden segment,” stated Myers President and CEO John C. Orr in a news release. “Earlier this year, we announced phase one which is focused on reducing costs in the nursery and greenhouse businesses.”
Myers calculated the two phases will boost profit by $15 million per year beginning in 2015.
Waco plant manager Robert Burkhart said in a news release: “The Waco team has made progress in its ability to competitively service the market, but has been disadvantaged by its geographic location in relation to customers.”
Brantford plant manager John Bielby said his facility’s closure is “a result of economics we face in our industry.” The company said it will retain a customer service presence in the Canadian lawn and garden market.
The Sparks operation will be poised to better serve the West Coast market and help the segment achieve future growth. Myers had closed a nursery products plant in Sparks in 2009.
Myers’ lawn and garden segment sales in the second quarter slipped 3.8 percent from a year earlier to $40.9 million. However, adjusted income before taxes was $1.2 million vs. a $1.5 million loss in the 2012 period. The income rise was attributed to productivity improvement and material substitution. Overall, Myers sales in the second quarter were $204 million, up 12.7 percent. Earnings grew by 47 percent to $8.3 million.
The firm’s other segments are material handling, distribution, including tire tools and related equipment, and engineered products. Materials handling benefited from acquisition of Brazil’s Plasticos Novel SA, a producer of reusable plastic crates and totes. The segment’s sales grew 40 percent to $83.8 million and income before tax at $11 million was up 20 percent. The purchase of a steel cart and cabinet producer in 2012 also helped lift results. | |
