Premier Foods plc is to close one of its Hovis bakeries in a further bid to cut costs, resulting in 82 job cuts.
The UK’s largest food manufacturer, which also produces brands such as Ambrosia and Mr Kipling, said today (16 February) that the closure of the Eastleigh bakery is part of “ongoing efforts to improve the utilisation and cost effectiveness of the Hovis supply chain”.
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A spokesperson for Premier Foods told just-food that the cuts were not part of an announcement earlier this year to cut around 5% of its total workforce.
“What was announced [in January] was a scaling down of back office functions, mainly associated with admin, not operating roles. This announcement is in response to the fact that it is the smallest of the bakeries in the group and it is not flexible enough.”
Premier said it has recently undertaken a review of its Eastleigh facility, taking into account the company’s future manufacturing requirements.
“As a result, the company is proposing that its bakery at Eastleigh, Hampshire will cease production no later than mid-June 2012,” Premier said. “This will, regrettably, affect approximately 82 jobs and consultation will begin immediately with those affected by this proposal and their representatives.”
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By GlobalDataThe bakery is one of 12 that produces Hovis for Premier in the UK. The brand is one of the company’s biggest divisions, generating revenues of GBP688m (US$1.08bn) in 2010, down 7% on the prior-year.
Faced with high debts and in the wake of two profit warnings in 2011, the UK’s largest food maker, under new CEO Michael Clarke, has been offloading assets to strengthen its balance sheet and looking to refocus the business.
