High Liner Foods To Cease Production At Malden In Q2

(RTTNews) - High Liner Foods Inc. (HLF.TO) Friday said it would cease production at its leased manufacturing facility in Malden, MA, in the second quarter of 2015 to reduce excess capacity across its U.S. manufacturing facilities. The lease of this facility expires in December.

This plant, with annual production of approximately 11.5 million pounds, is currently the company's most underutilized manufacturing facility. It is being transitioned to the company's New Bedford and Portsmouth facilities.

High Liner will book after-tax impairment charge of about $0.8 million to write down equipment to its estimated net realizable value.

Under IFRS, most of this impairment will be reflected in the financial statements for the fourth quarter of 2014, and the remainder will be expensed between January 2015 and cessation of production activities at the Malden facility.

In addition, after-tax cash costs of $0.3 million related to the closure will be expensed over the period from today to the cessation of employment at the plant.

The annual ongoing pre-tax reduction in operating costs as a result of this consolidation is estimated to be about $3.0 million.

Following cessation of the plant's operations, the company's manufacturing footprint in North America will consist of four owned and operated plants: three plants in the U.S. and one plant in Canada.