K-C's restructuring 'shouldn't affect local workers'
Published 2:07 pm, Friday, October 31, 2014
New Milford officials said they hope a planned restructuring at Kimberly-Clark will have little impact on the company's Pickett District Road facility, or its 350 workers.
Executives with Kimberly-Clark recently revealed restructuring plans including up to 1,300 layoffs worldwide, during a conference call to discuss the corporation's third-quarter financial results.
Company officials said the restructuring would be to improve the efficiency of the company and to eliminate "stranded overhead" that results from the recent spinoff of its health care division, according to spokesman Bob Brand.
"We want to manage our costs better," Brand said, "and free up resources to invest in the company as we look for more growth opportunities."
He added the layoffs would involve only a fraction of the company's global workforce and would include mostly salaried employees.
The restructuring, he said, would have little impact on production employees, which make up the majority of Kimberly-Clark's work force in New Milford.
The mill on Pickett District Road, the town's largest employer, produces Kleenex tissues as well as Scott paper towels.
"New Milford is a very important part of our tissue business," Brand said, "and we are very proud of the work that the employees do there."
While company officials declined to comment on whether mill closings would be part of the restructuring plan, local officials said they doubt the company would close the New Milford facility because of recent investments at the plant.
Mayor Pat Murphy said the company is undertaking a $30 million, yet-to-be-announced project to improve packaging equipment at the site.
"It's the single-largest investment in the facility since it was built," Murphy stated.
Luigi Fulinello, the town's economic development director, said all indications for the future of the local plant look positive.
"I've been regularly engaged with the local management here in New Milford," Fulinello said.
"We will continue to do everything we can to support the company and its work force as they continue their growth."
The company expects to complete restructuring by the end of 2016 and expects to save up to $140 million by the end of 2017.
Company officials recently announced net sales for the third quarter, about $5.4 billion, represented a 3 percent increase over the same period last year.
Diluted net income per share for the third quarter was $1.50, compared with $1.42 during the third quarter of 2013.
The company's stock rose nearly 2 percent in trading on Oct. 23 to close at more than $113 per share.
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