Silgan Holdings Inc. of Stamford, Conn., is shuttering its blow molding plant in Valencia, Calif., a site it has operated since its 2000 acquisition of RXI Holdings Inc.
Silgan leases the 122,000-square-foot site, Bob Lewis, Silgan's chief financial officer, said in an April 20 telephone interview. The move will affect about 90 employees. Officials announced the closing along with first-quarter operating results April 20.
Officials said the closing is a result of Silgan's focus on cash returns across its manufacturing platform. Lewis would not disclose the number of machines at the site but said the company will sell some equipment and transfer the rest to other facilities.
``We are pleased with our first-quarter financial performance and maintain a positive outlook for the year,'' said Tony Allott, Silgan's president and chief executive officer, in a news release.
``Due to the delay in resin cost pass-through to our customers, our plastics business benefited from the lagged recovery of resin cost escalation experienced in the fourth quarter of 2005 as resin prices declined during the first quarter,'' he said.
Staff cuts and improved productivity also helped the plastics operations' bottom line, he added.
Sales for its plastics container business were $163.2 million in the first quarter, an increase of $7.3 million compared with the same period in 2005. That increase primarily was due to higher average selling prices on passing through increased resin and other inflationary costs, officials said.
Silgan operates 18 blow molding sites across the United States and Canada, including Port Clinton, Ohio; Cape Girardeau, Mo.; Scarborough, Ontario; and Mississauga, Ontario.