Macon, Georgia - The China Clay Producers Association announced today the composite earnings for the four major kaolin producers in the state of Georgia for 2004.  The industry posted an after tax profit of only $28.7 million which represents a return of 3.59% on the net investment. 

 "There continues to be tremendous pressure on the kaolin industry to keep the industry competitive in the global marketplace.  However, high energy costs and rising chemical costs have eroded profitability.  In addition, the Georgia kaolin industry is struggling from increasing foreign competition and other competing minerals,” said Lee Lemke, Executive Vice President of the China Clay Producers Association.  “The last five years have been dismal.  Profitability has averaged a negative 0.94% for a five year period with significant losses reported in 2000 and 2001.”

 “As a mature industry, the Georgia kaolin companies have experienced major restructuring and continue to reduce payroll and expenses,” said Lemke.  Direct employment in the industry totals 2,568 employees, down from its peak of 4,500.  Restructuring has resulted in a shutdown of older unprofitable assets, which has reduced the net investment almost 21% for the four CCPA member companies in the last 5 years. The industry’s investment in Georgia now stands at $799 million.

 “Unfortunately, the kaolin industry in Georgia is not seeing the reinvestment in capital, as assets are shifting to more profitable areas.  This redeployment of assets will continue until income numbers reflect an acceptable return on investment,” reported Lemke. 

 For further information, please contact Lee Lemke via mail at 4885 Riverside Drive, Suite 108, Macon, GA 31210; via telephone at (478) 757-1211; via fax at (478) 757-1949; or via e-mail at leelemke@georgiamining.org.

 The China Clay Producers Association members are Engelhard Corporation, Gordon, GA; IMERYS, Atlanta, GA; J.M. Huber Corporation, Atlanta, GA; and Thiele Kaolin Company, Sandersville, GA.