PITTSBURGH, PA – December 19, 2008 – Zinc producer Horsehead Corporation, a wholly owned subsidiary of Horsehead Holding Corp (NASDAQ: ZINC) , today announced that it is taking aggressive steps to reduce operating costs, including idling its recycling facilities for the last week of 2008, reducing its salaried workforce, and revising the construction strategy for its new South Carolina facility.
We are facing a unique economic climate which has resulted in a rapid reduction of steel production and thus a lower volume of electric arc furnace dust available as feed for our recycling operations, said Jim Hensler, Horsehead’s President & CEO. We believe that temporarily idling our recycling facilities for the last week of 2008 is a prudent strategy to address the lower volume of feed for those operations. Hensler also noted that one of the two kilns at the Company’s Rockwood, Tennessee recycling facility may remain idled into the first quarter of 2009, as would the flame reactor at the Beaumont, Texas facility.
Horsehead also announced that on December 1, 2008, it reduced its salaried workforce after previously reducing the use of consultants and temporary employees. Horsehead expects that these reductions will result in annualized savings of approximately $2 million. Horsehead has also performed a comprehensive review of its contracting strategy for construction of its new South Carolina facility. In furtherance of our efforts to reduce costs, we have reviewed staffing levels to ensure that we operate at the most efficient levels, said Hensler. Additionally, we have re-evaluated our contracting strategy for our new South Carolina recycling facility and plan to undertake the majority of the general contracting functions to reduce costs, Hensler added. We expect to reduce the total capital cost of the project with this approach; however, this change will delay the start-up until the 1st quarter of 2010.
Horsehead Holding Corp. (NASDAQ:ZINC) is a leading U.S. producer of specialty zinc and zinc-based products. Headquartered in Pittsburgh, PA, Horsehead employs over 1,000 people and operates six facilities throughout the U.S.
Visit www.horsehead.net for more information.