Vienna – Semperit AG is shutting down a 120-employee production site for conveyor belts in China, the Vienna-based group has announced.
The decision to terminate production at the Sempertrans production site Best (ShanDong) Belting Co. Ltd, was made after a “thorough analysis.”
Located in the Shandong province on the Chinese east coast, the site had a turnover of €15 million in 2017.
The shutdown is part of an ongoing company restructuring process, according to Semperit chairman Martin Füllenbach.
“In the course of this [review of production footprint], it was noted that other production sites in perspective show higher margins,” explained Füllenbach.
Additionally, the Austrian rubber goods manufacturer expects the shutdown to reduce complexity at group level.
Semperit said it was taking “appropriate social measures” for the affected employees.
The plant shutdown will have a €10-million impact on the group’s earnings (EBIT) in 2018, including impairments and other valuation allowances in addition to provisions.
The company in Shandong was founded by Semperit as a joint venture with the state-owned energy company Wang Chao Coal & Electricity Group in 2010.
The Chinese partner currently holds a 16.1% stake.
The production site manufactures textile and steel cord belts and has served the export markets and the Chinese market so far.