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Latest headlines

Plant Closings

Lamb Weston to Close Washington Plant

Lamb Weston logo
October 2, 2024

Lamb Weston Holdings Inc., supplier of frozen potato products, has announced plans to close its manufacturing facility in Connell, Wash.

The closure is part of a restructuring plan Lamb Weston unveiled Oct. 1. The company also revealed it would temporarily reduce production across its manufacturing network in North America.

“To drive operational and cost efficiencies, we are taking actions that include the permanent closure of an older, higher-cost processing facility and the temporary curtailment of certain production lines and schedules in our manufacturing network,” says President and CEO Tom Werner. “Together, we expect these actions will help us better manage our factory utilization rates and ease some of the current supply-demand imbalance in North America. We are also taking actions to reduce operating expenses, including reducing headcount and eliminating certain unfilled job positions, as well as reducing capital expenditures. The combined estimated savings from these actions are reflected in our updated fiscal 2025 targets.”

Lamb Weston reported it would reduce its global workforce of 10,000 by 4% and eliminate unfilled job positions. The company will also reduce fiscal 2025 capital expenditures from $850 million to $750 million.

Lamb Weston projects the restructuring plan will generate approximately $55 million in pre-tax cost savings and a reduction in working capital in fiscal 2025.

In connection with the restructuring plan, the company expects to record total estimated pre-tax charges of $200 million to $250 million, with approximately 80% being cash and 20% being non-cash. The charges primarily relate to the cost of contracted raw potatoes that will not be used due to production line curtailments, accelerating depreciation of assets, the write-down of inventory and long-lived assets, employee severance and other one-time termination benefits, and other costs. Lamb Weston expects to record most of the pre-tax charges in the second quarter of fiscal 2025, with the remainder expected to be recorded during the second half of fiscal 2025.

KEYWORDS: frozen food frozen vegetables plant closings potatoes

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