Koppers Inc., a wholly-owned subsidiary of Koppers Holdings Inc., announced its decision to discontinue phthalic anhydride production at its Stickney, Illinois facility in 2025. This move is driven by significant near-term capital spending requirements that could not be economically justified by end-market projections. The company plans to ramp down production over the next six months, targeting a mid-2025 shutdown.
The cessation of operations is expected to result in pre-tax charges to earnings of $51 million to $55 million through the end of 2026, with approximately $28 million being non-cash charges in 2024 and 2025. Cash expenditures of $23 million to $27 million are anticipated over the next two years for plant cleaning, waste disposal, and demolition costs. This action is consistent with Koppers' strategy to optimize its business portfolio and enhance free cash flow.
An ancillary benefit of this decision is an expected improvement in the site's environmental footprint, with annual emissions of certain regulated air contaminants projected to be reduced by 50 to 70 percent. The closure will not impact the Stickney facility's coal tar distillation operations. Ongoing operational and capital expenditure savings from this action have been incorporated into the company's current 2025 goals for adjusted EBITDA and capital expenditures.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.