Co-operative negotiations in Incap’s Helsinki factory concluded – the factory will be closed down

Incap Corporation          Stock Exchange Release                

25 January 2012 at 12.15 p.m.                                       

CO-OPERATIVE NEGOTIATIONS IN INCAP’S HELSINKI FACTORY CONCLUDED – THE FACTORY WILL BE CLOSED DOWN

The negotiations concerning the entire personnel of the Helsinki factory have concluded today. After evaluation of different alternatives for adjustment of operations and improvement of profitability Incap has decided to close down the Helsinki factory and will transfer the production to the company’s other factories. The decision means that the employment contracts of 8 white-collars and 48 blue-collars will be terminated gradually during winter and spring. The close-down of the factory and the production transfer will have no effect on customer relationships or deliveries.  

According to preliminary estimates the main part of the factory’s production will end by autumn 2012. The sheet-metal manufacturing will be transferred partly to Incap’s factory in Vaasa and partly to subcontractors. The final assembly will be transferred to Kuressaare factory. More exact schedule of the product transfers will be available during the next few weeks.

Incap estimates that the close-down of the factory will bring annual savings of about EUR 1.6 million in fixed costs. The Helsinki factory is operating in leased premises.

Says Mr Sami Mykkänen, President and CEO of Incap Group: “We have already for a longer time searched for a solution to improve the profitability of the Helsinki factory. Negotiations on the sale of the sheet-metal manufacturing business were continued until the end of last year but they did not lead to any satisfying result. Keeping up the competitive edge in sheet-metal manufacturing in Helsinki would have meant remarkable investments in machinery during the next few years, and these were considered to be inappropriate in the present market situation.”

“Close-down of the factory is a heavy measure for the personnel but it is necessary for the company’s future. Centralisation of the manufacturing operations in Kuressaare and Vaasa plants increases the capacity utilisation rate and lowers the fixed costs. Decrease in production costs enhances also our customers’ competitive edge. In addition, the centralisation gives us better means for developing the company’s operations further.”

INCAP CORPORATION

Sami Mykkänen
President and CEO

Further information:
Sami Mykkänen, President and CEO, tel. +358 40 559 9047
Kirsi Hellsten, Director, Human Resources, tel. +358 50 387 7437
Hannele Pöllä, Director, Communications and Investor Relations, tel. +358 40 504 8296

DISTRIBUTION
NASDAQ OMX Helsinki Ltd.
Principal media
The company’s home page www.incap.fi

INCAP IN BRIEF
Incap Corporation is an internationally operating contract manufacturer whose comprehensive services cover the entire life-cycle of electromechanical products from design and manufacture to maintenance services. Incap’s customers include leading equipment suppliers in energy efficiency and well-being technologies, for which the company produces competitiveness as a strategic partner. Incap has operations in Finland, Estonia, India and China. The Group’s revenue in 2010 amounted to EUR 59.2 million, and the company currently employs approximately 730 people. Incap’s share is listed on the NASDAQ OMX Helsinki. Additional information: www.incap.fi.