Kimberly-Clark to Exit Disposable Diapers, Modify Tissue Segments in Europe

Kimberly-Clark, Dallas, Texas, USA, has decided to terminate disposable nappies production and sales in Western and Central Europe and exit the diaper category. Only Italy is not included in the action. The company will also be examining a variety of other sales or withdrawal options for areas of business with poor margins and poor growth, especially in the consumer tissue segment.

K-C reportedly is closing or selling a total of five production facilities in Europe, four of them part of the group’s Consumer division and one in the Professional segment. The changes will affect between 1,300 and 1,500 employees. The group is currently planning to close two plants in Barton-Upon-Humber and Flint in the U.K. The Barton facility manufactures nappies, the Delyn plant in Flint, Wales, is part of Kimberly-Clark Professional and mainly manufactures disposable paper towels. The remaining production lines in Flint are not affected by the closure. K-C’s disposable nappy plant in Calatayud, Spain, is to be sold, as is the Alanno facility in Italy where toilet paper is produced and the Klucze plant in Poland where the group produces toilet paper and facial tissue. The company did not disclose any details on why it is not considering a sale of the facilities in the U.K.

The group’s business report for the third quarter of 2012 also reveals that the company’s European administration is to be streamlined to bring cost structures into line with the strategic decisions. The total restructuring costs are to amount to $250-350 million after taxes. The areas of business being closed or sold generate annual sales of some $500 million and negligible operative profits, the group reports. This repositioning in the market enables K-C Consumer Europe to operate more profitably in the future and to grow in a number of key markets, the company said. Most of the measures are to be concluded by the end of 2013.