Thursday, Multi-Color Corp. (LABL) revealed plans to consolidate its heat transfer label, or HTL, manufacturing facility located in Framingham, Massachusetts into its other existing facilities. The transition will begin immediately with final plant closure within the next several months.
In connection with the closure of the Framingham facility, the company anticipates to record a total charge of about $2.6 million during its fourth quarter, consisting of about $1.4 million in cash charges for employee severance and other termination benefits related to 62 associates and about $1.2 million in non-cash charges related to asset impairments.
In addition, the company projects total net revenues for the third quarter to increase about 30% to $63.0 million from $48.3 million. The increase in revenues is due to the Collotype acquisition completed in February 2008. Collotype revenues of about $22.0 million for the quarter were offset by negative organic growth of about 15% or $7.3 million. Total net revenues are expected to be lower than analysts' estimates as a result of continued softness within North America and the impact of foreign currency fluctuations.
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