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Bemis Company Announces Actions to Reduce Cost Structure

NEENAH, Wis.--(BUSINESS WIRE)--Bemis Company, Inc. (NYSE: BMS) announced today its planned actions in a restructuring and cost savings program to improve efficiency and profitability that further positions the Company for long-term success. The Company will implement these initiatives while maintaining the high quality products, best-in-class service, and culture of respect and innovation consistent with Bemis’ standards.

“Improving the performance of our U.S. Packaging business is a key priority in creating value for our shareholders," said William F. Austen, Bemis Company's President and Chief Executive Officer. "During April, we began a review to align our U.S. manufacturing and administrative cost structures with the demands of our customer base to better position the Company in the current environment and for its long-term success. Given the challenges in the Brazilian economic environment, we also expanded the scope of our review to include our entire global business. We are targeting a total company cost savings plan of $55 to $60 million as we create a more agile, streamlined, and efficient business that is well-positioned for the long-term.”

Actions include:

Optimizing manufacturing capacity. The Company has definitive plans to close two manufacturing facilities; work performed at these facilities will be transferred to other Bemis locations. The Company will initiate the closing of one of these facilities in 2017 and the other in 2018. Benefits from these two plant closures will be approximately $10 million when fully implemented. The Company continues to evaluate opportunities to consolidate additional facilities.

Reducing SG&A Cost Structure. The Company will reduce its administrative support cost structure to align with the current business environment. These activities will result in a reduction of approximately 300 positions, or 5 percent of the global administrative workforce, over the next three years. Impacted employees will receive job placement assistance and severance benefits to assist in their transition. The cost savings from these changes will be approximately $20 million over the next three years.

The Company will provide additional details associated with its targeted savings plan in the coming quarters as part of its regular earnings reporting cycle.

Austen commented, “We are focused on improving our...