Premier Foods, the company behind Oxo stock cubes and Mr. Kipling cakes, has revealed it will close a plant in the West Midlands, threatening over 300 jobs.
The company has announced a site in the town of Knighton, which straddles the border between England and Wales, has become unprofitable and would be closed by the middle of 2023.
The company is currently negotiating with employees at the factory, which primarily produces powdered drinks.
Premier Foods said the move will cost the business about £10 million.
In a statement, the company said: “It is recognised that this will be an unsettling time for those c.300 colleagues who are potentially affected by these proposals, and they will be fully supported and consulted with throughout the process.
The job cuts come despite strong growth for the company.
It has revealed successive quarters of strong financial results for the company.
Premier Foods saw group sales increase by 12 percent in the final three months of 2022, with grocery sales increasing by 17 percent and international sales increasing by 10 percent.
It had previously enjoyed three successful years as a result of increased consumption during the pandemic, rewarding shareholders with a 20 percent increase in dividend payouts in 2022.
Alex Whitehouse, chief executive of Premier Foods, said: “These results illustrate the continuing appeal of our portfolio of market-leading brands in such a challenging environment and demonstrate the strength and resilience of our branded growth model.
“Our major grocery brands produced a particularly good set of results for us, continuing to grow faster than the market. Across the country, people got cooking again this Christmas.”
Premier Foods employs 4,000 employees working from 15 locations around the country.
It provides retailers and wholesale with products under the labels Bistro, Ambrosia, Bachelors, Loyd Grossman, Oxo, and Sharwood’s.
According to Mr. Whitehouse, the corporation had been coping with rising costs brought on by inflation.
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Whitehouse said: “Input cost inflation remains at elevated levels, and we continue to take action to offset this inflation through a range of measures”.
“With strong trading momentum as we enter our final quarter of the year, and with more brand investment and new product launches to come, we are well on track to deliver on expectations for the full year.”
Source: Sky News