New Sherbrooke Plant Doubles its Tissue Paper Capacity
17 Dezembro 2021 - 9:45AM
KP Tissue Inc. (“KPT”) (TSX: KPT) and Kruger Products L.P. (“KPLP”)
today announced KPLP’s plan to add to the capacity of its
Sherbrooke expansion project by constructing a double width Light
Dry Crepe (LDC) tissue machine with a capacity of at least 60,000
MT instead of the previously announced 30,000 MT LDC tissue
machine.
This additional capacity will allow us to
accelerate the growth of our business and continue to provide our
customers across North America with high quality tissue products
like Cashmere®, SpongeTowels®, Scotties® and Purex® in Canada and
White Cloud® in the U.S., said Dino Bianco, CEO with KPLP.
With this enhancement, the total estimated cost
of the Sherbrooke expansion project, which also includes the
previously announced addition of a bathroom tissue converting line
(“BT Line”) to the existing TAD Sherbrooke plant and a new plant
that will house a facial tissue converting line (“FT Line”) with
the double width LDC tissue machine, has increased from $240
million to $351.5 million. The additional costs of the project will
be financed by an increase in the senior bank facility for the
project from $75 million to $150 million and an equity investment
by KPLP of $36.5 million.
The construction schedule remains the same. The
BT Line and FT Line will be commissioned in 2022 and 2023
respectively while the LDC tissue machine is expected to start up
in 2024.
Forward-Looking Statements
Certain statements in this press release about
KPT’s and KPLP's current and future plans, expectations and
intentions, results, levels of activity, performance, goals or
achievements or any other future events or developments constitute
forward-looking statements. Forward-looking statements in this
press release include, but are not limited to, statements regarding
the projected capacity of the Sherbrooke project and the expected
dates for commencement of construction and production of the
Sherbrooke project. The words "may", "will", "would", "should",
"could", "expects", "plans", "intends", "trends", "indications",
"anticipates", "believes", "estimates", "predicts", "likely" or
"potential" or the negative or other variations of these words or
other comparable words or phrases, are intended to identify
forward-looking statements. The forward-looking statements are
based on certain key expectations and assumptions made by KPT or
KPLP. Although KPT and KPLP believe that the expectations and
assumptions on which such forward-looking information is based are
reasonable, undue reliance should not be placed on the
forward-looking statements since no assurance can be given that
such expectations and assumptions will prove to be correct.
Many factors could cause KPLP’s actual results,
level of activity, performance or achievements or future events or
developments (which could in turn affect the economic benefits
derived from KPT’s economic interest in KPLP), to differ materially
from those expressed or implied by the forward-looking statements,
including, without limitation, the following factors, which are
discussed in greater detail in the “Risk Factors – Risks Related to
KPLP’s Business” section of the KPT Annual Information Form dated
March 11, 2021 available on SEDAR at www.sedar.com: Kruger Inc.’s
influence over KPLP; KPLP’s reliance on Kruger Inc.; consequences
of an event of insolvency relating to Kruger Inc.; risks associated
with the Sherbrooke plant and project; operational risks;
significant increases in input costs; reduction in supply of fibre;
increased pricing pressure and intense competition; KPLP’s
inability to innovate effectively; adverse economic conditions;
dependence on key retail trade customers; damage to the reputation
of KPLP or KPLP’s brands; KPLP’s sales being less than anticipated;
KPLP’s failure to implement its business and operating strategies;
KPLP’s obligation to make regular capital expenditures; KPLP’s
entering into unsuccessful acquisitions; KPLP’s dependence on key
personnel; KPLP’s inability to retain its existing customers or
obtain new customers; KPLP’s loss of key suppliers; KPLP’s failure
to adequately protect its intellectual property rights; KPLP’s
reliance on third party intellectual property licenses; adverse
litigation and other claims affecting KPLP; material expenditures
due to comprehensive environmental regulation affecting KPLP’s cash
flow; KPLP’s pension obligations are significant and can be
materially higher than predicted if KPLP Management’s underlying
assumptions are incorrect; labour disputes adversely affecting
KPLP’s cost structure and KPLP’s ability to run its plants;
exchange rate and U.S. competitors; KPLP’s inability to service all
of its indebtedness; exposure to potential consumer product
liability; covenant compliance; interest rate and refinancing risk;
risks relating to information technology; cyber-security;
insurance; internal controls; trade; and risks related to
COVID-19.
Readers should not place undue reliance on
forward-looking statements made herein. The forward-looking
information contained herein is expressly qualified in its entirety
by this cautionary statement. The forward-looking information
contained herein is made as of the date of press release and KPT
undertakes no obligation to publicly update such forward-looking
information to reflect new information, subsequent or otherwise,
unless required by applicable securities laws.
About KP Tissue Inc. (“KPT”)
KPT was created to acquire, and its business is limited to holding,
a limited partnership interest in KPLP, which is accounted for as
an investment on the equity basis. KPT currently holds a 14.5%
interest in KPLP. For more information visit:
www.kptissueinc.com.
About Kruger Products L.P.
(“KPLP”) KPLP is Canada's leading manufacturer of quality
tissue products for household, industrial and commercial use. KPLP
serves the Canadian consumer market with such well-known brands as
Cashmere®, Purex®, SpongeTowels®, Scotties® and White Swan®. In the
U.S., KPLP manufactures the White Cloud® brand, as well as many
private label products. The Away-From-Home division manufactures
and distributes high-quality, cost-effective product solutions to a
wide range of commercial and public entities. KPLP has
approximately 2,700 employees and operates nine FSC® COC-certified
(FSC® C-104904) production facilities in North America. For more
information visit www.krugerproducts.ca.
INFORMATION: |
INVESTORS: |
François Paroyan |
Mike Baldesarra |
General Counsel & Corporate Secretary |
Director of Investor Relations |
KP
Tissue Inc. |
KP
Tissue Inc. |
Tel.: 905-812-6936 |
Tel.: 905 812-6962 |
francois.paroyan@krugerproducts.ca |
IR@KPTissueinc.com |
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