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STERIS Corp.’s targeted restructuring plan

Manufacturing Group | March 29, 2014

$20M restructuring charge to be recorded in the fourth quarter of fiscal 2014 ; Approximately $10M in annual savings anticipated

Cleveland, Ohio - STERIS Corp. announced a targeted restructuring plan, which includes the closure of STERIS's Hopkins Production Facility in Mentor, Ohio, as well as other actions. Approximately 150 positions will be eliminated as a result of the restructuring plan, about 100 of which are in Ohio. The vast majority of the people who will be impacted have already been notified. The Hopkins Facility primarily produces STERIS's SYSTEM 1E Liquid Chemical Sterilant Processing System and related chemistry and accessories. Business operations at the Hopkins Facility are expected to cease by Oct. 31, 2015. The company will relocate the production of these products to existing North American manufacturing operations.

The company anticipates that it will incur a restructuring charge of approximately $20 million in the fourth quarter of fiscal 2014 related to these actions. Of the $20 million charge, approximately $12 million is non-cash. Restructuring charges will be excluded from the company's adjusted earnings per diluted share. Cost savings resulting from these actions are anticipated to be approximately $10 million a year, with approximately half of the benefit beginning in fiscal 2015 and the balance in fiscal 2016.

"As a result of the reduced demand for our SYSTEM 1E product family following the completion of the SYSTEM 1 transition, the Hopkins Facility is now running significantly below full capacity," said Walt Rosebrough, STERIS president and CEO. "While we have not made final decisions on the locations of all of the Hopkins production, this closure enables us to more efficiently utilize our existing North American manufacturing network."

Source: STERIS Corp.

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