Norske Skog to evaluate its Australasian newsprint capacity due to weak demand, 'little penalty' in fixed costs and productivity to run one fewer machine, will consider divestiture, conversion, repurposing, says company's chief

LOS ANGELES , May 7, 2012 () – Norske Skogindustrier ASA is looking to possibly reduce its newsprint production capacity in the Australasian region due to weak demand, said the company’s chief, reported EUWID-Paper on May 7.

The Oslo, Norway-based papermaker also might sell more non-core assets; although there are not many non-core assets left after the company’s extensive restructuring, divestitures and closures, said Norske Skog CEO Sven Ombudstvedt.

Norske Skog will continue to evaluate the situation and a decision could be made by the end of this year, Ombudstvedt said during the release of the company’s first-quarter results, EUWID-Paper reported.

In terms of fixed costs and production capacity, there would be “little penalty” in operating “four rather than five machines” for newsprint output, said Ombudstvedt.

Other than shutting down a newsprint machine, the company also will consider converting the capacity or repurposing it for other industrial uses, he said, reported EUWID-Paper.

The primary source of this article is EUWID-Paper, Gernsbach, Germany, on May 7, 2012.

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