Toilet Paper Warehouse in California Destroyed by Fire; Employee Arrested

An employee of a company that operates a distribution center for Kimberly-Clark Corp. has been arrested on arson charges after a massive fire broke out Tuesday at the facility in California that serves around 50 million people.

The 1.2 million-square-foot warehouse — located in Ontario, about 35 miles outside of Los Angeles — houses facial tissue and toilet paper, according to a local Fox report. Ontario Deputy Fire Chief Mike Wedell told Bloomberg News the building’s roof completely collapsed and all products inside were destroyed.

Photos from the scene showed the entire building engulfed in flames. The blaze reached a six-alarm response, involving around 175 firefighters, the Ontario Fire Department said.

Kimberly-Clark said it’s taking action to mitigate the impact and maintain deliveries. That includes identifying other shipping locations and securing additional warehouse capacity. No manufacturing assets were impacted and property damage policies are in place.

“The company is working through mitigating any short-term disruptions as these plans are executed,” Kimberly-Clark said in a statement. The firm will provide further updates with its next quarterly earnings report, currently scheduled for April 28.

Shares rose about 2% at the open of trading on Wednesday. The stock had declined roughly 8% this year.

The local fire department said it had identified a suspect: Chamel Abdulkarim, an employee of NFI Industries, a third-party logistics provider for Kimberly-Clark products.

Abdulkarim, 29, was initially reported as missing and was “later suspected to have started the fire in the warehouse and quickly located by Ontario Police Department personnel,” the department said. He faces multiple arson-related felony charges and is being held without bail at West Valley Detention Center, it said.

“This fire was suspicious in nature from the initial stages,” Wedell told Bloomberg earlier.

Kimberly-Clark said in a statement that there were no reported injuries.

Analysts warned that the fire could lead to supply problems in the region.

The blaze “risks West Coast supply shortages for more than 3% of sales” at Kimberly-Clark’s US business and could raise transportation costs, according to a note from Diana Gomes, a Bloomberg Intelligence senior industry analyst.

Piper Sandler analyst Michael Lavery wrote in a note to clients that the level of disruption is “difficult to gauge” at this point, but warehouses and mixing centers in the area frequently supply products to large markets in Northern California, Arizona and Nevada.

Lavery isn’t planning to update his financial projections for the company “without better visibility on the magnitude and duration of the impact of any potential disruptions.”

In November, Kimberly-Clark, which sells the Huggies diaper and Kleenex tissue brands, said it had agreed to buy Tylenol maker Kenvue Inc.

Top photo: A Kimberly-Clark distribution center damaged following a fire in Ontario, California, US, on Tuesday, April 7. Photographer: Kyle Grillot/Bloomberg.