October 27, 2008
Columbus, Ohio-based Worthington Industries has announced that it is reducing its workforce by nearly 300 through a combination of plant closings and layoffs. The facilities to be closed are: in steel processing, the Louisville, Ky., facility and in metal framing, the Renton, Wash., location.
"These actions are a continuation of the broad-based cost cutting and transformational effort we began a year ago," said John P. McConnell, Chairman and CEO of Worthington Industries. "Pursuing these efforts is even more important as the industry sees the downward declines in the automotive, construction and other markets. It is never pleasant to displace employees, but it is critical that we control our costs and appropriately manage our balance sheet during these difficult economic conditions. We also intend to drive additional cost savings by optimizing work schedules and reducing or eliminating overtime." McConnell added, "While this has become a more challenging business environment, our focus is on preserving what has distinguished us throughout prior economic cycles: profitability, financial strength and consistent dividends."
The Louisville facility was opened in 1961, the first facility in the Worthington Steel Company outside of Columbus. At the time, it served a growing Southern market including large appliance manufacturers and a number of roll-forming companies. While profitable for a number of decades, the market in this region significantly shifted in recent years. Louisville employs 50 employees and is expected to close by May 31, 2009. The steel processing business segment is also reducing its workforce by 60 seasonal and temporary workers.
The Renton facility employs 22 and will be closed by December 31, 2008. The metal framing facility was opened in 2000, but has experienced a decline in demand the past two years. Dietrich Metal Framing is laying off an additional 150 employees across the organization.
It is estimated that these actions will result in annual savings of $13 million with one-time expenses of $6 million, primarily due to severance costs and asset write-downs.