Donnelley Eyes New Platform

To create a cost-effective, integrated, and flexible "platform of the future," R.R. Donnelley & Sons Company, Chicago, plans to invest $300 million in its long-run printing network over the next two years; close its short-run magazine, catalog, and advertising insert plant in South Daytona, Fla. in June; and decide late this month whether it will close its facility in Des Moines, Iowa.

Also, because of a wide-spread softening in the economy, Donnelley lowered by about 10% its earnings-per-share expectation range for 2001 that it had released at the end of January.

In the capital improvement plan, involving long-run printing and binding operations serving magazine, catalog, and retail customers, Donnelley intends to replace older equipment with fewer yet wider and faster presses that yield virtually no change in total capacity. Ten new presses and related bindery equipment are to be added.

Work produced in the South Daytona plant, which employs 198 people and was opened in 1991, will be transferred to other sites.

The Des Moines facility, where about 800 people are employed, produces a variety of magazines under long-term contracts, as well as catalogs and newspaper advertising inserts. Donnelley acquired the plant in 1990.

In a separate announcement, Donnelley's Premedia Technologies unit formed a partnership with ScreamingMedia Inc., a New York City-based provider of content solutions, by which magazine publishers can transform print content into electronic content and distribute it through private or general syndication channels to meet subscribers' needs for specific information.

Thus, publishers can convert content from application files such as Quark into formats like XML or HTML.