11:55 AM EST, 01/31/2025 (MT Newswires) -- (Updates shares.)

Dorel Industries (DII-B.TO) late on Thursday said it is restructuring its Home segment as part of efforts to realign its business model to industry dynamics.

The company will reduce its non-manufacturing workforce, close manufacturing operations based in Montreal, accelerate a stock keeping unit reduction initiative, and reduce its distribution footprint.

The company in the third quarter said it is closing a manufacturing facility in Tiffin, Ohio, with all production being assumed by facilities in Cornwall, Ohio.

The cost of the initiatives is estimated at US$9 million, the majority of which will be paid in 2025. Non-cash write-offs and accelerated depreciation of assets accounted for in 2025 are estimated to be an additional US$9 million.

The full benefits will be realized in 2026 with an expected improvement in earnings of up to US$40 million, the company said.

Following the COVID-19 pandemic, the Home segment requires a much smaller footprint than in the past, the company said. Since the pandemic, the industry has struggled with supply chain uncertainty, inflation and higher interest costs, resulting in consumers de-prioritizing spending on home furnishings, Dorel said.

Dorel now intends to focus on its core competencies and long-term relationships with retailers that sell moderately priced furniture, requiring Dorel to adjust its business model and reduce its overall footprint.

Additionally, Troy Franks has assumed the role of CEO of Dorel Home, replacing Norman Braunstein upon his retirement.

Dorel's Class B shares were last seen down $0.19 to $5.10 on the Toronto Stock Exchange.

Price: 5.10, Change: -0.19, Percent Change: -3.59