Resolute Forest Products Inc. (formerly known as Bowater) announced this week the indefinite idling of pulp and paper operations at its Calhoun, Tennessee mill, according to a press release by the company. The company anticipates that the decision will directly affect 350 hourly and salaried positions.
Currently, 545 people work at Resolute Forest Products. The 350 layoffs represent a 64 percent reduction in the company’s workforce.
“We have taken the very difficult decision to indefinitely idle pulp and paper operations at Calhoun knowing how hard this is for the affected employees and their families,” Remi G. Lalonde, president and chief executive officer of Resolute Forest Products, said in a statement. “Success has proved elusive at Calhoun’s pulp and paper operations, despite the best efforts of our dedicated employees and significant investments of time, energy and resources over the last few years.”
The company said that pulp and paper operations will continue for up to 60 days in order to “ensure an orderly shutdown, to accommodate environmental safeguards and to transition customers.” Additionally, the company said it will work with union leadership and will apply the mill’s collective agreement and applicable federal and state laws as well as provide severance benefits to those directly affected. Resolute will also engage government officials and other local authorities in an effort to mitigate the impact of the indefinite idling, the press release notes.
“Our focus now will be to support our employees through this difficult time, to operate for the remaining period with the same degree of focus on safety and quality, and to facilitate a smooth transition for our customers,” added Lalonde.
Resolute Forest Products continues to accumulate significant financial losses at the mill, even with the current strong market conditions for both the pulp and uncoated freesheet paper it manufactures, the press release reports. On a trailing twelve-month basis ending September 30, the pulp and paper operations in Calhoun produced an operating loss of $62 million before corporate expense allocation, including a depreciation expense of $10 million. In addition to these financial losses, the Calhoun mill faced additional significant production upsets in November and December.
However, once the indefinite idling is completed, the company anticipates an improvement in its overall operating income, of approximately $35 million to $40 million, which reflects the lost pulp integration benefit with its tissue manufacturing of approximately $15 million and approximately $5 million from on-going costs associated with closed site maintenance, according to the press release.
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Kaitlin Housler is a reporter at The Tennessee Star and The Star News Network. Email tips to [email protected]
Photo “Resolute Forest Products Factory” by Resolute Forest Products.Â
I noticed that this is a union shop. That sure does not help matters. It just runs up costs.
Sounds like the owners peeled too much money out of the company. WAY too much. I mean, for an established company, in a solid industry with plenty of demand, to be financially strapped like this… is ridiculous. Like I said… witness GREED, at play. Excessive greed. Overly-wealthy owners, being overly-discourteous to ALL those employees, and their families, type Greed. Discourteous to the employees that made the greedy owners wealthy.
A laid-off employee should start #DefundResoluteForestProducts , & #BoycottResoluteForestProducts pages!
It sucks when the people at the bottom suffer because a business is ran poorly. I could understand if they manufactured a niche luxury product. But this is recycled paper. It’s used in a million different things, for example, toilet paper. Demand is always high.
Too bad we don’t have a President who could fly in there and school these owners on how to run a business.