UPM Raflatac to Increase Production Capacity of its Film Labelstock Business in Europe

UPM, Helsinki -? UPM Raflatac plans to increase production capacity for its film labelstock business in Europe by investing approximately EUR 13 million in a new coating line at the companys self-adhesive labelstock factory in Nowa Wies, Poland. This initiative will support UPM Raflatacs target to secure cost competitive growth in films in the long term. The start-up of the new assets is estimated to take place in Q1/2015. Following the planned investment, an older film coating line in Tampere, Finland and the UPM Raflatac siliconising line in Tervasaari, Finland will be closed.

In addition, UPM Raflatac plans to improve productivity in its sheet labelstock business by closing sheet labelstock coating operations and reducing capacity in sheets finishing in Polinya, Spain. The sheet coating will be centralized to Nowa Wies.

The planned actions are estimated to result in annual cost savings of about EUR 4 million starting from 2015 and exceeding EUR 6 million in 2016.

If all plans are implemented, the estimated total personnel impact would be a maximum of 122 positions in the affected countries: a maximum of 86 positions in Spain and a maximum of 36 positions in Finland. The final decisions will be taken after employee consultation and negotiations in the relevant countries. The majority of restructuring is estimated to be completed by the end of 2014.

“In our film business we have enjoyed robust growth in Europe in recent years and therefore we are planning to increase filmic coating capacity in Nowa Wies, Poland. The majority of the film market is in Central and Southern Europe and with this capacity we will be able to serve our customers in those market areas better in future. According to the plan, we aim to streamline our capacity in Tampere, Finland to meet the needs of the reduced service area”, says Tapio Kolunsarka, Executive Vice President, UPM Raflatac.