Eastman Strengthens Global Copolyester Manufacturing Structure

KINGSPORT, Tenn., March 30, 2004 – Eastman Chemical Company (NYSE:EMN) today announced further steps toward strengthening its global copolyester manufacturing capabilities. Following consultations with the union and the employees at its Hartlepool, England site, Eastman has decided to close that site and consolidate production to other facilities. Eastman said while it has ample capacity from multiple production lines at other sites to meet current customer needs, it is also preparing to meet future market growth by initiating plans to increase its copolyester manufacturing capacity at its headquarters site in Kingsport, Tenn.

“The decision to close the Hartlepool site was a difficult one because of the impact on the dedicated and highly professional employees we have there,” said Jim Rogers, executive vice president and president of the company’s Eastman Division. “But by consolidating production at sites that are more integrated through our raw material stream, we’ll be able to sustain over the long-term our ability to continue to provide customers with consistent, high quality copolyester products on a global basis.”

According to Rogers, manufacturing scale and integration with the company’s monomer streams are key components to Eastman’s long-term copolyester business strategy. “Our overall position as a supplier to this very competitive copolyester market will strengthen as we take better advantage of our integrated manufacturing capabilities,” he said. “Our sales personnel will be working closely with customers during this transition to make sure we continue to meet their product needs.”

The Hartlepool site manufactures a variety of copolyesters, including Eastman’s Embrace, Eastar copolyester 6763 and Eastar Bio biodegradable copolyester. While Eastman expects to transfer the majority of production to its Kingsport site, the company’s copolyester manufacturing facility in Kuantan, Malaysia, also has capacity that can be used to meet demand as required.

The Hartlepool site, which has 75 employees, manufactures products that are within the company’s specialty plastics segment’s product lines. The company said that any asset impairments and restructuring charges resulting from the decision to close the site will be reflected primarily in its first-quarter 2004 financial results scheduled for release on April 29.

“Because of the continued good work of the Hartlepool employees, we have sufficient regional inventories to ensure a smooth transition and to provide continued supply to our European customers as we complete this consolidation,” said David Speicher, regional business director for Eastman’s European, Middle East and Africa region.

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