Canada Bread Company has announced plans to shutter its snack cakes bakery in Shawinigan, Quebec, at the beginning of May.
The site currently produces a number of branded snack cakes including Cadbury, Chevalier and Obsession.
The company said the move will improve efficiency by reducing overheads and supporting its focus on higher margin products and “new market opportunities”.
“We have experienced a significant decline in consumer demand for snack cakes in recent years,” Richard Lan, president and CEO of Canada Bread explained.
“We are conducting a strategic review to identify category expansion opportunities. Based on the outcome of this work, there could be potential in the future to utilise this plant to support other manufacturing requirements. However, based on declining capacity utilisation we have no alternative but to close the facility. We deeply regret the impact this decision has on our people and are committed to supporting their transition to new employment.”
The closure will affect 74 employees who currently work at the factory. Costs associated with the closure will total around C$3.1m (US$3m) before tax and the expense will be lodged in 2013.
Canada Bread is 90% owned by Maple Leaf Foods.