EveryWare Global said it is temporarily halting production at its Anchor Hocking plant in Monaca and another plant in Lancaster, Ohio, while the troubled company negotiates with creditors over a loan default.
Spokeswoman Erika Schoenberger did not disclose the number of hourly and salaried employees who will be idled for three to four weeks. The company said certain employees are being furloughed without pay.
Halting production will preserve cash and work off existing inventory, the company said. A small staff at both plants will be used to fill orders in the weeks ahead, Ms. Schoenberger said.
EveryWare has 2,048 employees, including 1,930 full-time workers, according to a March 31 regulatory filing. More than 1,600 work in distributing and manufacturing, and nearly 1,300 workers are represented by the United Steelworkers union.
On Thursday, EveryWare reported a first-quarter loss of $38.3 million, or $1.87 cents per share, versus earnings of $197,000, or 2 cents per share, in the year-ago quarter. Revenue fell 5 percent to $94.8 million.
The company lost $17.4 million last year and $4 million in 2012.
The company blamed the loss on a number of factors including a $20.7 million tax-related impairment charge and severe winter weather, which resulted in higher utility costs. It also cited higher severance expenses and fees paid to consultants who are developing cost-savings initiatives.
EveryWare said it is expanding the role of Alvarzez & Marsel, a turnaround consultant that is advising the company.
The company said it is in default on a $250 million loan and has until May 30 to convince lenders to either waive the default or agree to new terms. Cash generated by operations and other available credit “are not expected to be sufficient to fund our operations in the near future,” the company said in a press release.
Production is expected to resume in three or four weeks, but the timing depends on several factors including how talks with lenders go, the company said.
EveryWare shares fell sharply Friday, closing at 94 cents, down 44 cents. They are off 89 percent this year.
Nearly 60 percent of the shares are owned by affiliates of Monomoy Capital Partners, a New York private equity firm that merged the Anchor Hocking and Oneida brands in 2012, when the company went public.
Len Boselovic: 412-263-1941 or email@example.com