LONDON (Alliance News) - UK manufacturer C&C Group PLC Tuesday said it plans to consolidate its production sites to focus on its manufacturing site in Clonmel, Ireland, leading to job losses, but also said it will invest EUR10.0 million to enhance the sites capabilities.
C&C Group made the decision following a detailed review of its manufacturing and operational footprint, which will see the company consolidate its production from sites in Shepton Mallet in England and Borrisoleigh in Ireland, into its manufacturing site in Clonmel, Tipperary.
"Under the proposal, production and packaging will be transferred on a phased basis from the facilities in Shepton Mallet and Borrisoleigh. Consequently, Clonmel will become the core manufacturing site for both Bulmers and Magners cider, Tipperary Water and our range of niche premium beers and ciders," said the company.
The manufacturing site based in Glasgow will be unaffected. The fruit milling operation at Shepton Mallet is not impacted by the proposal and C&C will continue to source apples on a long-term basis from local farmers. Equally, Borrisoleigh will remain as a key transport hub and both logistics and warehousing operations will be maintained in the town.
To support the move, C&C plans to invest EUR10.0 million into the Clonmel site to enhance its packaging and logistics capability and to create 80 new jobs. However, C&C said the net roles lsot through the change will be around 180, of which 127 are in the UK and 54 in Ireland.
"This has been a difficult decision for the group and it is sad that the consolidation of production at the Clonmel site is the only viable option to maintain long term competitiveness. C&C recognises the impact on employees and will work to provide support, training, and where possible, alternative employment," the company said.
"The trading environment in the UK and Ireland has been intensely competitive over recent years. This has led to significant downward pricing pressure and the loss of material contracts for private label water," said the company.
C&C's current capacity utilisation across the three impacted sites only stands at 34%, which is constraining the company's ability to compete over the longer term. Under the planned configuration, Clonmel will move to a capacity utilisation level of 75%.
C&C shares were trading up 0.4% to 3.78 pence per share on Tuesday afternoon.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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C&C Group (CCR)