Kemet announces additional gross margin improvement action
KEMET Corporation announced that, in a continuance of its effort to further improve gross margins, earnings, and cash flow, it is undertaking the following action: The Solid Capacitors group will modify its vertical integration strategy by relocating its K-Salt facility equipment to its existing Matamoros Mexico plant. The company expects to achieve annual operating cost savings of approximately $3.5M-$4.0M and improve annual working capital by approximately $8.0M with improvements beginning in Q4 of FY17. Non-cash impairment charges of approximately $2.1M, cash severance charges of approximately $0.2M, and cash charges for equipment relocation costs of approximately $1.2M are expected. The company will incur charges in Q2 ending September 30, with the exception of the equipment relocation costs that are expected to be incurred in Q3 of FY17.