Trinseo to restructure European operations, suspend dividend

Closure of MMA Production Facilities in Italy
The Company will permanently close its methyl methacrylate (“MMA”) production operations at its Rho, Italy facility and its acetone cyanohydrin (“ACH”) production operations in Porto Marghera, Italy. ACH is a precursor to MMA. Moving forward, the Company will source MMA feedstock from third-party producers, ensuring continuity of supply while improving overall cost to produce downstream products. Trinseo will continue its polymethyl methacrylate (“PMMA”) operations along with its recently opened depolymerization pilot facility in Rho. The Company will work closely with the Works Council, unions, and government officials to ensure alignment with respect to all legal requirements associated with this process. The closures are anticipated to be completed by the end of the year and expected to result in annualized profitability improvement of approximately $20 million and an annual reduction in capital expenditures of approximately $10 million.

In connection with the Italy MMA restructuring, Trinseo expects to record pre-tax charges for employee-related costs, asset-related and impairment charges and costs to exit production activities, including contract terminations, demolition and decommissioning ranging from $80 million to $100 million.

Cash payments associated with these actions are anticipated to total $40 million to $50 million, with substantially all payments expected to be made by the end of 2028. All workforce reductions will comply with local regulatory requirements.

Potential Closure of Polystyrene Production Facility in Germany
In addition, the Company announced it has initiated an information and consultation process with the Works Council of Trinseo Deutschland GmbH regarding the potential closure of its polystyrene (“PS”) production at its Schkopau, Germany production site and the intention to consolidate remaining PS production into its Tessenderlo, Belgium location. If an agreement is reached, this action is expected to result in annualized profitability improvement of $10 million.

Trinseo President and CEO Frank Bozich stated, “These plans are a by-product of the continuing challenges we and our peers in the European chemical industry have been facing for the past several years, including weak end market demand, high energy prices, and increased imports from Asia.”

Bozich added, “These decisions are never easy. With each one we know the livelihoods of colleagues and their families are being impacted. As we have done in each restructuring during this unprecedented trough, our primary focus has been on the safety of our colleagues, along with a respectful transition that aligns with our philosophy of simply doing the right thing.”

Dividend Suspension
In addition, the Board of Directors of the Company voted to indefinitely suspend the Company’s quarterly dividend of $0.01 per share, effective immediately, which action is expected to save approximately $1.5 million annually.

Looking Ahead
Despite these changes, Trinseo remains firmly committed to its customers, partners, and employees across Europe and around the world. The company will continue to invest in key markets and explore new opportunities to deliver value and impact.

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ALCHEMPro News Desk (RM)