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Burlington Announces Improvement Plan

The Board of Directors of Burlington Industries Inc., Greensboro, N.C., has approved a five-point plan to improve the companys future profitability and financial flexibility.We have outstanding capabilities within Burlington, but our performance this year is disappointing, said George W. Henderson III, chairman and CEO. Our results are due both to our own performance shortfalls as well as difficult market dynamics in some of the markets we serve. We are capable of doing better and we are committed to improving results.Among the current challenges Henderson noted are the trend toward casual dressing, lower exports to Europe due to the weakness of the Euro, competitive pricing in denim and reductions in interior furnishings product inventories at the retail level.The steps outlined in the companys five-point plan include: realigning operating capacity, including closing a plant in Johnson City, Tenn., reducing operations at the Clarksville, Va., PerformanceWear facility and reducing the size of the companys trucking fleet; eliminating unprofitable businesses, particularly in the companys PerformanceWear segment; reducing overhead through consolidation, cost reduction and job reductions; paying down debt; and eliminating excess historic enterprise goodwill.The planned closings and overhead reductions will eliminate approximately 950 jobs in the United States and 650 jobs in Mexico.We believe we have made a realistic assessment of our business, and we are taking a series of actions that will capitalize on our strengths and correct our weaknesses, said Douglas J. McGregor, president and COO. For example, we are continuing to grow our top-performing Lees carpet business, which is enjoying its best year in history. The effective execution of our five-point plan is critical to achieving better cash flow and debt reduction, which will allow us needed flexibility to grow.We deeply regret the job losses that are a necessary part of this plan, McGregor continued. We will do everything we can to help the affected employees make the transition to other employment.

November 2000