AptarGroup is to restructure 12 facilities in Europe, including the closure of two sites, in a bid to boost future growth in the region.
The firm said it would transfer and consolidate production capacity in Europe costing an estimated €14m (€18m using current exchange rates) and involving facilities serving food and beverage.
It said while demand in Europe was soft, Latin America and Asia continued to perform well.
The charges will be recorded in the quarter in which they are recognized and annual savings are estimated to be €9m ($12m using current exchange rates) beginning in late 2013, said the firm.
The manufacturer of closures and pressurized packaging serves the dairy, beverage and bakery markets.
Stephen Hagge, president and CEO, said: “We are benefiting from our continual investment in efficient production equipment and our ability to adapt to the changing needs of the markets we serve. In this instance, we looked at product lines, supply chains, and production capacity.
“We identified ways to streamline certain product technologies, reduce complexity for our people and our customers, and optimize our production footprint.”
Sales and income up
Food and Beverage net sales for the three months ending 30 September rose nearly $8,000 to $75,000 and segment income climbed to $9,600 from $6,900.
Hagge said: “The diversity of our business continued to help us achieve growth in a difficult environment. As we expected, it was a challenging quarter compared to the prior year, particularly in the beauty, food and consumer health care markets.
“Global sales to the beverage market continued to be strong and this more than offset softer food volumes, mainly in the US.”
AptarGroup said they continued to be ‘encouraged’ in terms of their performance but said Q4 was going to see further challenges in all its sectors.
“We are also optimistic that our market-focused approach will yield new applications for our innovative dispensing technologies. Nevertheless, we expect further challenges in the fourth quarter, including continued currency exchange rate headwinds, ongoing softness in certain markets driven by economic uncertainties…”
Aptar Food and Beverage will be exhibiting at Brau Beviale 2012 taking place in Nuremberg from 13 to 15 November.