Case Study

Paper Products Manufacturer

Family-owned business operated by second generation. Paper converter and producer of household and commercial paper products.


$80 million


Manufacturing, Wholesale Distribution

Services Provided

Turnaround & Business Restructuring, Enterprise Performance Improvement, Capital Solutions


Deep covenant default resulting from ($5 million) operating loss and non-compliance of loan and financial reporting requirements, compounded by management’s inability to explain causes of operating losses or how to fix them. As a result, lender asked them to exit the bank through a refinancing or be sold through a court proceeding.


  • Completed deep turnaround process within 12-month period, including reduction of labor costs, management of price increases, improvements in production workflows and equipment utilization; based on use of data analytics to pinpoint issues and improvements.

  • Completed exit financing to new lender for $17 million credit facility.

  • Using combined financial and operating data analytics, EMA was able to evaluate trends from comparative historical performance, and to evaluate product line and customer profitability. Customers had shifted buying patterns as pricing was increased, resulting in only 50% of pricing increases taking effect.

  • Labor content had increased significantly in key products even with new production machinery. The Company had focused on total labor cost and not on expected unit labor costs so while some products were produced more efficiently, the labor content shifted to other products that were not being closely monitored.

  • Machine downtime and changeover time was much higher than expected. To save money, management held off on upgrades and repairs which resulted in reduced throughput. Lack of proper production planning resulted in inefficient short production runs, higher material content costs, and frequent changeovers.