- Trinseo will close MMA and ACH production in Italy by year-end, improving profitability by $20 million annually.
- The closures will reduce capital expenditures by $10 million annually and incur pre-tax charges of $80-$100 million.
- Cash payments for these actions will total $40-$50 million, mostly completed by 2028.
- Trinseo considers closing its German PS facility, potentially improving profitability by $10 million annually.
Operational Changes in Italy
Trinseo will permanently close its methyl methacrylate (MMA) and acetone cyanohydrin (ACH) production facilities in Rho and Porto Marghera, Italy, respectively. The company will source MMA feedstock from third-party producers to ensure supply continuity and reduce production costs. These closures are expected to enhance annual profitability by approximately $20 million and reduce capital expenditures by $10 million annually.
Financial Impact
The restructuring in Italy will result in pre-tax charges ranging from $80 million to $100 million, covering employee-related costs, asset impairments, and production exit expenses. Cash payments related to these actions are anticipated to total $40 million to $50 million, with most payments completed by 2028.
Potential Closure in Germany
Trinseo is considering closing its polystyrene (PS) production facility in Schkopau, Germany, and consolidating operations in Tessenderlo, Belgium. If agreed upon, this move could improve annual profitability by $10 million.
Dividend Suspension
The company's Board of Directors has decided to indefinitely suspend the quarterly dividend of $0.01 per share, saving approximately $1.5 million annually.
Market Challenges
Trinseo's President and CEO, Frank Bozich, cited ongoing challenges in the European chemical industry, such as weak market demand, high energy prices, and increased Asian imports, as reasons for these strategic decisions. The company aims to focus on safety and a respectful transition for affected employees.
