Glatfelter to Expand Capacity of Rapidly Growing Composite Fibers Business Unit
YORK, Pennsylvania – October 27, 2011 – Glatfelter (NYSE: GLT), a leading global supplier of specialty papers and fiber-based engineered materials, today announced capacity expansion plans for its Composite Fibers business unit, which serves the growing global tea and single serve coffee markets, among others.
The Company will invest US$50 million at its Gernsbach, Germany facility to expand its inclined wire capacity by nearly 20%, or approximately 10,500 short tons, by converting a conventional flat wire paper machine to a state-of-the-art inclined wire paper machine used to manufacture filter papers for tea bags and single-serve coffee applications as well as certain composite laminate products and technical specialties.
Dante C. Parrini, chairman and chief executive officer, said, “Shipments for our Composite Fibers business have increased by approximately 20% over the past two years, led by the strong worldwide demand for beverage filter papers. While our continuous improvement initiatives have generated significant incremental capacity, the rapid growth of this business is simply outpacing our organic capacity gains. This expansion will not only allow us to continue to meet the growing demand of our market-leading customers with sophisticated and innovative products, but it will solidify our leading position in this rapidly growing, global category.”
The project will take place primarily in 2012; the new machine is expected to begin production in the first quarter of 2013. The Company expects to achieve a 15% to 20% return on this investment within three years, has ample liquidity to fund the project and expects it will be financed from cash balances or the Company’s revolving credit facility.
Caution Concerning Forward-Looking Statements
Any statements included in this press release which pertain to future financial and business matters are “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and are subject to numerous risks, uncertainties and other unpredictable or uncontrollable factors which may cause actual results or performance to differ materially from the Company’s expectations. Various risks and factors that could cause future results to differ materially from those expressed in forward-looking statements include, but are not limited to: changes in industry, business, market, political and economic conditions in the U.S. and other countries in which Glatfelter does business, demand for or pricing of its products, changes in tax legislation, governmental laws, regulations and policies, initiatives of regulatory authorities, technological changes and innovations, market growth rates, cost reduction initiatives, the cost, and successful design and construction, of the Composite Fibers capacity expansion project and other factors. In light of these risks, uncertainties and other factors, the forward-looking events discussed in this press release may not occur and readers are cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements speak only as of the date of this press release and Glatfelter undertakes no obligation, and does not intend, to update these forward-looking statements to reflect events or circumstances occurring after the date of this press release. More information about these factors is contained in Glatfelter’s filings with the U.S. Securities and Exchange Commission, which are available at www.glatfelter.com.
Headquartered in York, PA, Glatfelter is a global manufacturer of specialty papers and fiber-based engineered materials, offering over a century of experience, technical expertise and world-class service. U.S. operations include facilities in Spring Grove, PA and Chillicothe and Fremont, OH. International operations include facilities in Canada, Germany, France, the United Kingdom and the Philippines, and sales and distribution offices in Russia and China. Glatfelter’s sales approximate $1.8 billion annually and its common stock is traded on the New York Stock Exchange under the ticker symbol GLT. Additional information may be found at www.glatfelter.com.