Koppers to close plant in Denver

Company cites lower sales during pandemic

Koppers plans to close a plant in Denver in a move that will impact 26 employees.

The facility, to be shut down by August, provides chemicals to treat utility poles and railroad crossties.

The closure will result in pre-tax charges to earnings of up to $13 million through June 2021, Koppers said.

The Downtown-based company said it will move production to other facilities and some employees may move to other roles within Koppers.

It also said a long-term contract with a railroad industry customer should boost market opportunities for wood crossties and related products.

Koppers declined to name the customer.

It will upgrade capacity at another treatment facility to accommodate future growth, Koppers said.

The company released the news Wednesday as part of its series of monthly business updates during the COVID-19 pandemic.

“I take seriously the decision to cease operations at any of our plants and deeply regret the impact that the closure at our Denver facility will have on employees that have dedicated their careers to strengthening Koppers’ reputation,” Leroy Ball, company president and chief executive, said in a statement.

For the month of May, the company said global sales totaled $144.1 million, down 1.7% from $146.6 million in May 2019.

While the pandemic resulted in soft demand and lower prices for its carbon chemicals used in manufacturing, Koppers said sales of performance chemicals used in wood preservatives for residential applications rose on strong demand from home improvement retailers.

For the second quarter that ends June 30, Koppers forecast sales of $410 million to $420 million, down from $443.9 million in the second quarter a year ago.

The company expects secondquarter earnings per share of 70 cents to 85 cents, down from $1.14 last year.

Mr. Ball said the current forecast is “much better than what was feared back in March.”