High Liner Foods

 - High Liner Foods ceasing operations in its leased facility in Malden, MA to consolidate its U.S. manufacturing operations (all figures are in U.S. dollars ("USD") unless otherwise noted) --

LUNENBURG, NS, Jan. 9, 2015 /CNW/ - High Liner Foods Incorporated (TSX: HLF) ("High Liner Foods" or "the Company"), the leading North American value-added frozen seafood company, today announced it will cease production at its leased manufacturing facility in Malden, MA, in the second quarter of 2015 to reduce excess capacity across its U.S. manufacturing facilities.  The lease of this facility expires in December 2015.  Following cessation of the plant's operations, the Company's manufacturing footprint in North America will consist of four owned and operated plants: three plants in the U.S. (in Portsmouth, NH, Newport News, VA, and New Bedford, MA) and one plant in Canada (in Lunenburg, NS).

"The Company recognizes this is a difficult day for the employees who work at the Malden plant and their families.  High Liner Foods has been operating this facility since acquiring Viking Seafoods in 2010 and we were extremely fortunate to have inherited such a dedicated and hard working team of employees," said Mr. Keith Decker, President and Chief Operating Officer of High Liner Foods.  "While the decision to cease production at one of our facilities has been difficult, it is necessary to ensure High Liner Foods' continued ability to grow and compete in a highly competitive and price sensitive market place.  50 full time employees currently work at the Malden facility, some of whom will be moved directly to positions at other facilities and the remaining employees will have the opportunity to apply for open or new positions at our Portsmouth and New Bedford facilities."

High Liner Foods operations at the Malden plant are scheduled to cease by the end of the second quarter of 2015.  This plant is currently the Company's most underutilized manufacturing facility with annual production of approximately 11.5 million pounds that is being transitioned to the Company's New Bedford and Portsmouth facilities.

An after-tax impairment charge of approximately $0.8 million will be recorded to write-down equipment to its estimated net realizable value.  Under IFRS, most of this impairment will be reflected in the financial statements for the fourth quarter of 2014, with the remainder being expensed between January 2015 and cessation of production activities at the Malden facility.  In addition, after-tax cash costs of approximately $0.3 million related to the closure will be expensed over the period from today to the cessation of employment at the plant. 

The annual ongoing pre-tax reduction in operating costs (which represents an increase in earnings before interest, taxes, depreciation and amortization, or EBITDA) resulting from this consolidation is estimated to be approximately $3.0 million.  

About High Liner Foods

High Liner Foods is the leading North American processor and marketer of value-added frozen seafood.  High Liner Foods' retail branded products are sold throughout the United States, Canada and Mexico under the High Liner, Fisher Boy, Mirabel, Sea Cuisine and C. Wirthy labels, and are available in most grocery and club stores.  The Company also sells branded products under the High Liner, Icelandic Seafood, FPI, Viking, Mirabel, Samband of Iceland and American Pride Seafood labels to restaurants and institutions, and is a major supplier of private label value-added frozen seafood products to North American food retailers and food service distributors.  High Liner Foods is a publicly traded Canadian company, trading under the symbol HLF on the Toronto Stock Exchange.

This document contains forward-looking statements. Forward-looking statements can generally be identified by the use of the conditional tense, the words "may", "should", "would", "believe", "plan", "expect", "intend", "anticipate", "estimate", "foresee", "objective" or "continue" or the negative of these terms or variations of them or words and expressions of similar nature. Specific forward-looking statements in this document include, but are not limited to expectations with respect to: timing of plant closures; timing and final number of related layoffs; amount and timing of the related one-time cash expense; amount and timing of the write-down of plant and equipment; amount and timing of the annual ongoing reduction in operating costs resulting from the plant consolidation; and amount and timing of the operating and capital expenditures in excess of normal requirements to allow the movement of production between plants. These statements are based on a number of factors and assumptions including, but not limited to: availability, demand and prices of raw materials, energy and supplies; the condition of the Canadian and United States economies; foreign exchange rates, especially the rate of exchange of the Canadian dollar to the U.S. dollar; our ability to attract and retain customers; our ability to grow and remain competitive in the future. The statements are not a guarantee of future performance. By their nature, forward-looking statements involve uncertainties and risks that the forecasts and targets will not be achieved. Readers are cautioned not to place undue reliance on forward-looking statements, as actual results may differ materially from those expressed in such forward-looking statements. We include in publicly available documents filed from time to time with securities commissions and The Toronto Stock Exchange, a discussion of the risk factors that can cause anticipated outcomes to differ from actual outcomes. Except as required under applicable securities legislation, we do not undertake to update forward-looking statements, whether written or oral, that may be made from time to time by us or on our behalf, whether as a result of new information, future events or otherwise.

For further information about the Company, please visit our website at www.highlinerfoods.com or send an e-mail to investor@highlinerfoods.com.

SOURCE High Liner Foods Incorporated

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