UK milk processor Robert Wiseman Dairies today (27 January) admitted that over 130 jobs could be under threat as the company considers closing a production site and distribution depot.

The group, which supplies milk to the likes of Tesco, said it was mulling the closure of a dairy at Okehampton and a distribution site at Fife in Scotland.

Wiseman has started consulting with workers over its plans; some 69 staff face losing their jobs at Okehampton, while 68 could be left out of work at the Fife depot.

Affected staff at Okehampton could be offered alternative jobs at Wiseman’s Bridgwater dairy. Distribution workers may be able to transfer to other depots in Aberdeen and Whitburn.

“At Okehampton, we have to address the reality, which is that the cost of processing milk and the investment required at the site is prohibitively high in comparison to our other dairies in the UK. In the current environment, we have little option other than to review the viability of the site going forward,” said group operations director Martyn Mulcahy.

On the potential changes in Scotland, Mulcahy added: “Whilst we continue to make gains in growing our business in Scotland, it is important that we match our facilities with our future operational requirements.”

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Wiseman also announced today that it was sticking by its forecast for a fall in annual profits after revenues during the 17 weeks to 22 January met expectations.

In November, Wiseman said “intense competitive pressures” would see, without “improvement in margins or volume gains”, annual profits hit by GBP16m (US$25.5m).

The company noted that rises in “oil-related costs” had been “significant”. Wiseman said the higher cost of diesel and high-density polyethylene had the “potential to materially impact costs going forward” should they continue – and the company failed to offset the higher expense.

Shares in Wiseman were down 0.7% at 337.75p at 13:08 GMT this afternoon.