Lassonde Industries constructing new beverage mfg. facility in New Jersey
The facility is a key component of a capital investment program aimed at enhancing the competitiveness of Lassonde's U.S. beverage manufacturing network.
October 3, 2024 | By MRO Magazine
Lassonde Plant in Seabrook, NJ (CNW Group/Lassonde Industries Inc.) Lassonde Industries Inc. has announced a capital investment program aimed at enhancing the competitiveness of its U.S. beverage manufacturing network.
The program mainly consists in the investment of approximately US$200 million over an estimated two-year period for the construction of a new beverage manufacturing facility in New Jersey, on a site adjacent to the Corporation’s existing plant.
The company says that once built, the facility, extending across approximately 200,000 square feet, will replace the existing plant and enable Lassonde to fortify its competitive position in the key U.S. northeast market by improving operating efficiency and delivering incremental volume at lower costs through a more efficient production flow, improved yields, and better logistics. The investment is expected to be accretive with an internal rate of return that exceeds the Corporation’s cost of capital.
Construction is expected to begin in early 2025 and existing production activities will be progressively transferred beginning in 2026. The transition is expected to be completed in 2027, reaching a full run-rate by the end of that year.
“Lassonde is proud to launch an important investment program to strengthen its position as one of the leading North American fruit juice and drink manufacturers,” said Vince Timpano, Chief Executive Officer of Lassonde Industries Inc. “Since entering the U.S. market, we have methodically expanded our footprint and our initiatives will support further expansion of both our private label and branded beverage activities, while improving our profitability. Over the longer term, this investment program will offer the potential to add further production capacity and new capabilities to meet market opportunities.”
Following the recent US$53 million investment to expand its single-serve capabilities in North Carolina, Lassonde also plans to invest an additional US$20 million at this facility to fortify its role as a strategic production hub. This supplementary investment consists in bringing in-house certain owned production assets currently deployed at a co-packer facility. This in-sourcing, expected to be completed in 2025, will allow the Corporation to enhance network efficiency and reliability by optimizing the utilization of these assets, while providing more flexibility to meet incremental demand.
Related to the New Jersey project, certain existing assets will have to be depreciated at an accelerated rate over a period of ten quarters beginning in the fourth quarter of 2024. As a result, the Corporation expects its quarterly depreciation expense to increase by approximately US $1.5 million during that period.
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