Royal Star restructures its sawmill operations

Royal Star restructures its sawmill operations Royal Star Wood Products has decided to start negotiations with trade union representatives regarding the closure of the sawmills at Skogstorp and Katrineholm, Sweden. These negotiations are in accordance with Swedish employment laws. The changes proposed by the company will enable it to raise productivity, reduce costs and contribute to the necessary restructuring of the Swedish sawmill industry. A decision has also been made to specialise operations at Kvarnåsen by investing in increased capacity in the batten planing plant. These decisions are part of the necessary restructuring of what is a highly fragmented Swedish sawmill industry. The newly formed Royal Star Wood Products intends to play an active role in this work by meeting its responsibility in the creation of a stronger timber industry. "We are making our operations more efficient so that we can withstand increased competition at home and abroad," explains Anders Nilsson, President of Royal Star Wood Products. The target for the next two years is to further reduce costs and raise productivity. The sawmill at Skogstorp employs 51 people and the one at Katrineholm 13 people. Statutory negotiations with trade union representatives are expected to be completed during the first quarter of 2004. The aim is that both sawmills will be closed down after the end of June 2004. Customer requirements and the long-term supplies of raw material suppliers will be secured via the Group's twelve other sawmills, nine of which are in the same region as Skogstorp and Katrineholm. The Board has also decided to invest in increased capacity at the batten planing plant in Kvarnåsen (currently a part of AssiDomän Interiör). This investment is worth SEK 7.2 million. The investment means that the cutting and finger-jointing facility at Kvarnåsen will be relocated at one of the Group's other sawmills in the region. A small number of redundancies might also be necessary, but the exact number is not yet known. However, jobs will be created at the site to which the cutting and finger-jointing facility is moved. "Rationalisation creates good conditions for profitable production of untreated and painted battens at Kvarnåsen. Specialisation also improves our delivery capability towards the Scandinavian building materials sector, where we aim to be the leading distributor of converted and sawn timber products," says Anders Nilsson. For further information, please contact Anders Nilsson, President, Royal Star Wood Products Tel: +46 70 574 19 17 ------------------------------------------------------------ This information was brought to you by Waymaker The following files are available for download: