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KANNAPOLIS — Pillowtex Corp.’s top executive hosted more than 70 suppliers this morning at the company’s Fieldcrest Cannon offices to share a glimpse of his vision for the company’s future.
At the same time, Chief Executive Officer Chuck Hansen says the streamlining of the company’s manufacturing operations could continue with another N.C. plant closing.
Hansen held the meetings to thank the suppliers, he said, for their support and give them a look at the future of the company that’s been beset by financial troubles since last year.
The vendors supply the company with everything from polyester fiber to cotton yarn to rubber bands, Hansen said.
“They’ve been very supportive ... in terms of always keeping deliveries current and staying with us when we had those times when we were stretched financially,”said Hansen, also chairman of the Pillowtex board of directors.
The company says its financial skid began after a new computer system installed last year to track sales and collections failed to function properly.
That setback, along with a generally weak market for home textiles and other factors, fattened the company’s inventory to financially unhealthy levels.
In recent months, the company has laid off about 150 workers and idled manufacturing operations to cut costs and reduce inventory. And Pillowtex recently announced it will close its Salisbury plant in October.
Another plant in danger of closing is the company’s Rocky Mount facility, where most of its Ralph Lauren line is produced. The company’s license with the designer expires in mid-2001 and won’t be renewed.
“If we do not find some replacement business to put in that facility, that factory will be closed,” Hansen said.
Hansen said he couldn’t comment on the whether the 150 workers there would be offered jobs at other Pillowtex plants — as some at the Salisbury plant were — because of the union contract covering them.
He also plans to move most of the company’s accounting operations from the Dallas home office of Pillowtex to Kannapolis, he said.
In streamlining operations, Hansen aims to return the company — which posted losses of $27.9 million for the first six months of this year and is a billion dollars in debt— to profitability.
Pillowtex stock has fallen as low as $1.25 a share. On Wednesday, the stock closed at $2.44 a share, up 25 cents or 11.4 percent, enough to make the New York Stock Exchange’s top five percentage gainers.
Hansen said he’s “sick” of the rumors swirling around Pillowtex concerning its imminent demise or other plant closings. Pillowtex has reduced its inventory and improved its collections, he said, and he points to his own recent purchase of 200,000 shares of Pillowtex stock as proof of of his optimism.
“I’m very proud of this company. We’ve done a damn good job,” he said. “We have turned the corner, and we are going to be the great company I have always known we would be.”
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