Focus on local business Wausau Paper
MIDDLETOWN — The city of Hamilton was dealt blows from the paper industry when it was recently announced its two paper mills could close, but the story isn’t the same in Middletown.
Wausau Paper’s mill here is breaking production records, according to the company.
SMART Papers plans to start layoffs next month of more than 200 employees at its paper mill on North B Street in Hamilton. Mohawk Fine Papers announced Oct. 24 its plans to close Hamilton’s oldest mill on Dayton Street at the end of the year, putting 137 people out of work.
But Wausau on Columbia Avenue in Middletown has dramatically improved its performance in recent years, said Perry Grueber, spokesman for Wausau Paper.
The difference is the product produced.
The approximately 185 employees at Wausau in Middletown produce giant towel and tissue parent rolls, which are later converted into smaller ones for individual use or other purposes, Grueber said. SMART, once Champion Papers, and Mohawk, make coated premium paper and textured paper used for magazines and corporate documents. “We are in different corners of the paper industry,” Grueber said.
“Tissue’s becoming a much greater factor, a component, of Wausau Paper’s growth initiatives.”
Wausau invested in 2009 more than $30 million to rebuild a towel machine in Middletown. The project was completed in early 2010 and is performing well, he said.
“In fact, we are achieving operating performance records with that towel machine and have for the past several months,” he said.
Grueber declined to say the production levels for competitive reasons, but said the mill makes about 100,000 tons of tissue and towel paper a year.
The Wisconsin company announced in April its other towel and tissue manufacturing facility in Kentucky would receive a $220 million investment for a new machine. Currently the Harrodsburg, Ky., facility converts parent rolls from Middletown and bought elsewhere for use. After the project is finished early 2013, Kentucky will also start making parent rolls.
These investments in Harrodsburg and Middletown are part of an effort by Wausau to double sales in its towel and tissue segment in the next three to four years. Last quarter, the segment had an operating profit of $7 million, the company reported.
Part of the effort will be to introduce new products to be made in Middletown and Kentucky, he said.
“The strength of the operation in Middletown is critical to achieving this goal,” Grueber said.
Wausau sells three brands of towel and tissue paper — EcoSoft, DublNature and DublSoft — to wholesalers and distributors that service office buildings, hospitals and government, for example, he said. It doesn’t sell direct to customers.
Grueber says its growth has come from gaining new business customers and interest in its environmentally friendly products.
In addition to the towel and tissue segment, Wausau has four other business segments: food prep and packaging; tape and industrial products; coated and liner; and print and color. On Oct. 24, with the release of its third-quarter earnings, the company announced plans to end its print and color segment, part of an overall strategy to put money in its highest margin operations, Grueber said.
Wausau is also selling timberland to help pay for its towel and tissue investments, he said.
The print and color segment is still attractive, however, its margins are slimming. “The bigger factor is electronic substitution,” he said.
The Mosinee,Wisc.-based paper maker owns six manufacturing facilities in Wisconsin, Middletown, Minnesota and Kentucky. Wausau merged with Mosinee, which before that had acquired Bay West. The Middletown mill was originally founded by Erwin Brothers in the 1850s and later became Sorg before it became Bay West.
Contact this reporter at (513) 705-2551 or clevingston@coxohio.com.
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