US-based supplier of industrial and consumer packaging and a provider of innovative packaging solutions Sonoco Products has disclosed in a regulatory filing that it has been advised by one of its flexible packaging customers that its current contract to provide certain packaging will not be renewed in its entirety.
Earlier, the company noted that its flexible packaging unit is currently engaged in negotiations with a major customer regarding existing business the customer has put out for bid.
According to the customer, the business loss will be phased out over the next two years, Sonoco said.
As a result, Sonoco expects to take a noncash, after-tax asset impairment charge of nearly $8m in its third quarter of 2010.
However, the company noted that the expected loss of business will not impact current year sales or base earnings.