Exel Composites Plc to close its production facility in Germany
EXEL COMPOSITES PLC STOCK EXCHANGE RELEASE 1 FEBRUARY 2019 at 11:00 EET
Exel Composites’ subsidiary Exel GmbH has agreed with the local works council, Betriebsrat, to close production in the Voerde manufacturing facility in Germany by 30 April 2019. The Voerde facility is Exel Composites’ smallest unit where composite profiles mainly to the telecommunications industry have been produced. As volumes have declined due to the continued challenging market situation of the telecommunications industry, the utilization level of the Voerde facility has been low.
During February - April, production will be gradually transferred to other Exel Composites units to ensure an orderly transition with minimal impact on customers. As a result of closing production in Voerde, the employment of 23 permanent employees will be terminated. The company will offer them support in finding new employment.
The closure will result in annual cost savings of approximately EUR 1.0 million from 2020 onwards. According to preliminary estimations, the closure will result in a one-time cash cost of EUR 1.2 million that will be recorded in the first quarter of 2019. Furthermore, related to the annual impairment testing, an EUR 1.3 million write-off to goodwill and another EUR 0.3 million write-off to other balance sheet items will be recorded in the annual accounts of 2018.
The closing of production in Germany falls under the Group-wide cost reduction program initiated in 2018. In addition to optimizing Exel Composites’ manufacturing footprint in Europe, the cost reduction program consists of improving the profitability and cost efficiency of the acquired DSC business as well as further synergy savings between the company’s two manufacturing units in China, among other things. The annual savings target of the program is EUR 3 million, expected to be fully effective in 2020.
Vantaa, 1 February 2019
Exel Composites Plc
Riku Kytömäki, President and CEO
For further information, please contact:
Riku Kytömäki, President and CEO
tel. +358 50 511 8288
riku.kytomaki@exelcomposites.com
Mikko Kettunen, CFO
tel. +358 50 347 7462
mikko.kettunen@exelcomposites.com
Distribution
Nasdaq Helsinki Ltd
Main news media
www.exelcomposites.com
Exel Composites in brief
Exel Composites is the world’s leading composite technology company that engineers and manufactures composite products and solutions to an extensive range of demanding industrial applications.
The core of the business is based on the employees’ high level of expertise and own, internally developed composite technologies, which have been perfected over decades with a steady focus on innovation. With nine manufacturing plants across Europe, Asia, and North America, and a global sales network, Exel Composites is firmly driven by superior customer experience and world-class operations.
Headquartered in Finland, Exel Composites employs approximately 650 people globally. The company’s shares are listed on the Nasdaq Helsinki exchange.