Savaria Corporation
TSX : SIS

Savaria Corporation

October 11, 2007 14:36 ET

Savaria Restructures its Operations: Expected Operational Savings of $1.5 Million

LAVAL, QUEBEC--(Marketwire - Oct. 11, 2007) - Savaria Corporation (TSX:SIS), the second largest company in the accessibility industry in North America, announces the transfer of its production to its facilities in Brampton, Ontario and in Huizhou, China resulting in the closure of its Laval plant effective December 7, 2007.

"The steady increase in the value of the Canadian dollar is forcing us to consolidate our manufacturing facilities in order to optimize the use of our assets and to improve our profitability. However, an announcement like this always comes with sadness as the Laval plant was where Savaria's tremendous growth story began in 1989. This decision was therefore heartbreaking, but it was essential to ensure the Corporation's prosperity," explained Marcel Bourassa, Chairman of the Board, President and Chief Executive Officer of Savaria.

The Laval plant's production, primarily platform lifts, along with its technical support and after-sales services teams, will be transferred to the Brampton facility. Some 50,000 currently sub-leased square feet of this 170,000-square-foot building will be taken over and fitted out to that end. The integration of these operations will foster major economies of scale, as well as the standardization of the quality of products and after-sales services.

The Corporation is also intensifying its production outsourcing to its Chinese partners. Consequently, the floor space of the building leased by Savaria in China was expanded from 8,000 square feet to 35,000 square feet at the beginning of October 2007. Finally, its local personnel will grow from 25 to 50 employees by the end of this year.

This major decision will result in the layoff of 80 people in Laval, as well as the creation of 40 new jobs in Brampton and 25 new jobs in Huizhou. Management expects to achieve operational savings of approximately $1.5 million as of fiscal 2008 and to realize a gain on the eventual sale of the building.

Forward-Looking Statements

Certain statements in this press release may be forward-looking. Forward-looking statements involve known and unknown risks, uncertainties or other factors that may cause the Corporation's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.

Savaria Corporation (www.savaria.com) is Canada's leader and the second largest accessibility company in North America. The Corporation designs, manufactures and distributes products meeting the needs of people with mobility challenges, primarily stairlifts, vertical and inclined platform lifts, as well as elevators for residential and commercial use. Through its subsidiary Van-Action (2005) Inc., Savaria also converts and adapts automotive vehicles for the disabled. The Corporation's sales rely on a network of some 600 retailers in North America. Savaria records approximately 60% of its sales outside Canada and employs some 350 people. Its shares are listed on the Toronto Stock Exchange under the ticker symbol SIS.

Contact Information

  • Savaria Corporation
    Marcel Bourassa
    Chairman of the Board, President and Chief Executive Officer
    1-800-931-5655
    www.savaria.com