Cascades Inc. Announces Closure of Honeycomb Packaging Operations
Cascades Inc. is making significant changes to its operational strategy by exiting the honeycomb paperboard and partition packaging business segments. This announcement has been made by the company as part of its commitment to refine focus on strategic markets that align with its long-term goals.
Impact on Facilities and Employees
The company will close its three plants located in York, Pennsylvania, and Saint-Césaire and Berthierville, Quebec. The determination to discontinue operations is based on the recognition that these niche markets no longer support the company's profitability objectives.
The closure at the Berthierville facility is effective immediately, impacting 52 employees. However, to facilitate a smooth transition, certain assets of the plant will be acquired by Emballages LM, a prominent North American honeycomb paperboard producer for $9 million. This acquisition is designed to maintain service quality and ease the adjustment for existing customers.
Timeline for Other Closures
The York, Pennsylvania facility is slated for permanent closure by February 19, affecting 37 employees. This facility's production has been hampered by a declining demand from regional customers, prompting Cascades to make this difficult decision.
Additionally, operations at the Saint-Césaire plant, which specializes in cardboard partitions for the beverage industry, will cease by April 17, also due to declining market demand and geographic challenges. This closure will impact 25 employees.
Support for Affected Employees
Cascades is dedicated to providing necessary support to employees during this transition. The company will offer job search assistance and encourages impacted workers to explore opportunities at other facilities within the Cascades network.
Strategic Realignment of Cascades Inc.
In a statement, Hugues Simon, President and CEO of Cascades, emphasized the importance of aligning the company’s assets with its strategic markets to enhance profitability. He acknowledged the contributions of the employees at the three facilities, expressing gratitude for their years of service. Cascades is committed to continue investing in its prioritized sectors to strengthen its position as a reliable partner for customers.
It is important to note that these organizational changes will not affect the operations of the Cascades Sonoco – Berthierville plant, which operates adjacent to the Berthierville facility.
Company Overview
Established in 1964, Cascades Inc. is known for providing sustainable, innovative packaging, hygiene, and recovery solutions. Today, the company boasts a workforce of over 9,000 skilled individuals across 60 operating facilities in North America. Cascades continuously innovates its product offerings through effective management, extensive recycling experience, and ongoing research, contributing positively to community welfare and environmental sustainability. The trading symbol for Cascades on the Toronto Stock Exchange is CAS.
Frequently Asked Questions
Why is Cascades Inc. closing its honeycomb packaging business?
Cascades Inc. is closing this segment to align its operations with strategic markets that offer better profitability and growth opportunities.
What facilities are affected by the closures?
The closures will take place at the plants in York, Pennsylvania; Saint-Césaire, Quebec; and Berthierville, Quebec.
How many employees will be impacted by the closures?
Approximately 114 employees will be affected by the closures across the three facilities.
What support will be provided to the impacted employees?
Cascades Inc. will offer job search assistance and encourage affected employees to explore openings at other locations within the company.
What is the company's strategic direction moving forward?
Cascades aims to focus on its core strategic markets that align with its long-term goals, ensuring continued investment and growth in these sectors.
