Question-and-Answer Session
Operator
(Operator Instructions) Our first question comes from Rosemarie Morbelli - Ingalls & Snyder LLC.
Rosemarie Morbelli - Ingalls & Snyder LLC
How much capacity you have eliminated in North America since the end of 06 and how much is left at this stage?
Paul F. DeSantis
We've closed down the Canadian plant and we've sold the Texas facility, so those two plants, I'm thinking through the capacity of each individual plant. The Canadian plant was about 75 million pounds. This is what I think we disclosed in our 10-K. And I think the Texas plant was slightly larger than that, so that's a significant piece of the total capacity in North America that's gone now. So we would expect then, as I think we've said, we'd expect to see our capacity utilization in North America go up as a result of that.
Rosemarie Morbelli - Ingalls & Snyder LLC
And go up to where just based on that and all other things being equal, not considering further decline in the marketplace and so on?
Paul F. DeSantis
We would expect to see at least a 5 point increase in capacity utilization if not slightly more than that.
Rosemarie Morbelli - Ingalls & Snyder LLC
Let's look at engineered plastics since this is more or less where this went out. It was only at 5% so is that enough to really improve the North American businesses or do you need to take a lot more?
Paul F. DeSantis
Rosemarie, let me be clear, that 5% was for the total North American business. On the engineered plastics business we'd expect to see a bigger pick up.
Rosemarie Morbelli - Ingalls & Snyder LLC
And then just going back to my last question, first of all do you need to eliminate more and if you don't need to eliminate more, do you have enough in terms of the bottlenecking in order to meet future market growth whenever that happens?
Joseph M. Gingo
Rosemarie, that's a very good question and let me explain it like this, when we shut down the Canadian plant in order to meet demand, some of the Canadian lines had to go to our other operations in Bellevue, Ohio and Nashville, Tennessee and even to Mexico. What we've done is we've moved those lines but we've not installed them. So we're going to be watching the market and determining if there's a need to install those lines. Now eventually I personally believe there will be a need. Is it going to occur over the next 12 months? I think that's a very difficult question to answer in terms of the environment that we're currently facing. However, what I would say, with what I expect to face I'm in very good position to flex up. And if I have to flex up more, I'll accelerate the program or reinstate the program of reinstalling those lines. I hope that answered your question.
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