MONTREAL, Dec. 7, 2018 /CNW Telbec/ - Supremex Inc. ("Supremex" or the "Company") (TSX: SXP), a leading North American manufacturer and marketer of envelopes and a growing provider of paper-based packaging solutions, today announced a plan to reduce operating expenses at its Canadian envelope operations to improve resource allocation and further support the Company's diversification strategy into the growing packaging market.
Supremex is reducing its Canadian envelope facilities headcount by a total of 41 employees, or approximately 8% of its Canadian envelope workforce. These measures will result in annual cost reductions of approximately $2.7 million, before taxes, which will progressively materialize in the current quarter and will take full effect in 2019. A one-time charge of approximately $1.4 million, before taxes, will be recorded in the Company's 2018 fourth quarter results.
"We regret the effect that these measures will have on employees and their families, and wherever possible, we have transitioned employees to our packaging business and worked with them on early retirement possibilities. These cost cutting measures were necessary to improve operational efficiency and improve both competitiveness and profitability in our envelope business as we continue to prudently deploy resources into our packaging activities", said Stewart Emerson, President & CEO of Supremex.
This press release contains "forward-looking information" within the meaning of applicable Canadian securities laws, including (but not limited to) statements about the adjusted EBITDA and future performance of Supremex and similar statements or information concerning anticipated future results, circumstances, performance or expectations. Forward-looking information may include words such as anticipate, assumption, believe, could, expect, goal, guidance, intend, may, objective, outlook, plan, seek, should, strive, target and will. Such information relates to future events or future performance and reflects current assumptions, expectations and estimates of management regarding growth, results of operations, performance, business prospects and opportunities, Canadian economic environment and liability to attract and retain customers. Such forward-looking information reflects current assumptions, expectations and estimates of management and is based on information currently available to Supremex as at the date of this press release. Such assumptions, expectations and estimates are discussed throughout our MD&A for the year ended December 31, 2017.
Forward-looking information is subject to certain risks and uncertainties, and should not be read as a guarantee of future performance or results and actual results may differ materially from the conclusion, forecast or projection stated in such forward-looking information. These risks and uncertainties include but are not limited to the following: economic cycles, availability of capital, decline in envelope consumption, increase of competition, exchange rate fluctuations, raw material increases, credit risks with respect to trade receivables, increases in funding requirement of the Company's pension plans, postal services deficiencies, interest rates fluctuations and potential risk of litigation. Such risks and uncertainties are discussed throughout our MD&A for the year ended December 31, 2017 and in particular, in "Risk Factors". Consequently, we cannot guarantee that any forward-looking information will materialize. Readers should not place any undue reliance on such forward-looking information unless otherwise required by applicable securities legislation. The Company expressly disclaims any intention and assumes no obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.
The Management Discussion and Analysis and Financial Statements can be found on www.sedar.com and on Supremex' website.
Supremex Inc. is a leading North American manufacturer and marketer of envelopes and a growing provider of paper-based packaging solutions. Supremex operates 12 facilities across seven provinces in Canada and three facilities in the United States employing approximately 830 people. Supremex' growing footprint allows it to efficiently manufacture and distribute paper and packaging solutions designed to the specifications of major national and multinational corporations, resellers, government entities, SMEs and solutions providers. For more information, please visit www.supremex.com.
SOURCE Supremex Inc.
For further information: Stewart Emerson, firstname.lastname@example.org, 514 595-0555 extension 2316