Nevada County Picayune and Gurdon Times Newspaper Archive

IP workers should survive profit strategy

International Paper Company officials plan to either "sell the Gurdon plant operations to another company or spin it off' into another separate company."

Rick Ouellette, spokesman for the IP Gurdon Wood Products Plant, on Highway 67, said this week to the Arkadelphia Siftings Herald company officials have no plans to close the Gurdon facility.

Ouellette said Gurdon's plant has 625 employees, and has been too successful to close.

Ouellete added the Gurdon plant has a "great set of team members" making it a good place to buy.

Gurdon Mayor Clayton Franklin said three company officials, from International Paper, came to city hall with a press release on Tuesday.

Franklin said the release talked about IP planning a restructuring that could close down some facilities. The plan called for shrinking the company's operations in order to boost profits.

Rumors circulated Gurdon about the local jobs being in jeopardy, but Mayor Franklin said nothing in the press release, or that he has heard officially since, would indicate that the local plant will close.

Franklin, who has been instrumental in industrial development for the area, said, "With three IP officials coming to City Hall to offer reassurance, I am inclined to believe everything will be all right."

Bill Wright, president of the Clark County Industrial Council, said he believes there will be "little effect" on the local plant, "depending on who they sell to."

The Gurdon plant makes approximately $2 million a month, he said. "It is very profitable."

The executive director of the CCIC, Aaron Stewart, agreed, saying IP's Gurdon plant is seen as very lucrative in the marketplace.

Both sited the attitudes of IP employees they have recently consulted. "They didn't seem very upset," Stewart said.

"They feel like the plant will continue" operations as usual," Wright said.

Both Stewart and Wright stressed that if IP Gurdon does close, it would be a hard blow for Clark County to overcome.

"We can't plan for that massive an effect," Wright said. "It's unreasonable that they'd close it down."

Both said they will continue to watch the situation.

International Paper acquired the Gurdon plant in 1974 and manufactures plywood and lumber products.

The press release, given to Franklin, stated the IP wood products business produces lumber, plywood, utility poles and engineered wood products used for residential and commercial construction throughout North America. The 2004 sales from the business were approximately $1.5 billion.

The business employs more than 5,500 employees at manufacturing sites in Alabama, Arkansas, Florida, Georgia, Louisiana, Missouri, Mississippi, North Carolina, South Carolina, Texas and Virginia.

IP is the world's largest paper and forest products company. Businesses include: paper, packaging and forest products.

As to the shrinkage plan, "This isn't about being big. It's about being successful," John Faraci, IP's chief executive officer, said in a conference call with analysts.

"We are not waiting for the market to improve," he added.

Faraci said earnings per share should be 30 percent higher by 2007 as a result of the strategy.