Another RNS out!14 Nov 2024 13:25
2 million pound savings focus on Manchester. Good move indeed along with streamlining automation hence the new jobs I pointed out. MORE money in the bank swimming in it! IMHO DYOR GLA
Novacyt S.A.
("Novacyt", the "Company" or the "Group")
Further expansion of cost reduction programme
Proposed site consolidations expected to deliver c. £2.0m EBITDA improvement
Paris, France, Eastleigh and Manchester, UK - 14 November 2024 - Novacyt (EURONEXT GROWTH: ALNOV; AIM: NCYT), an international molecular diagnostics company with a broad portfolio of integrated technologies and services, announces proposed changes to its operational footprint which would lead to a further consolidation of global facilities and is expected to improve the Group's EBITDA position by an additional £2.0m annually.
Proposed closure of Eastleigh site
Following the refocus of the Primer Design business on the Research Use Only market, and a review of operations as part of a programme to implement further significant cost savings, the Company announces that it has begun a consultation process which may result in the closure of its Eastleigh site and relocation of the business to the Group's Manchester facility. A further announcement will be released in respect of the outcome of the consultation process in due course.
Transfer of Canada manufacturing operations to Manchester
In addition, the Company is in the process of closing Yourgene Health Canada's manufacturing site and relocating its operations to the Group's Manchester facility, where the manufacture of Ranger® instrumentation and consumables will take place. Yourgene Health Canada's research and development facility on Vancouver Island, responsible for developing improvements and updates to the Ranger® Technology portfolio, will remain in place.
Should the relocation of the Eastleigh operations proceed, the combined consolidations are expected to improve the Group's EBITDA position by c. £2.0m annually. A cash restructuring charge of c. £1.5m is expected in connection with the combined closures.
Lyn Rees, CEO of Novacyt, commented: "Whilst a difficult decision, consolidating our sites and having the Group's manufacturing based at our Manchester facility would provide a significant reduction in our cost base, in-line with our strategy. If completed, we believe that this move would benefit the entirety of the Novacyt business and represent a key step in right-sizing our cost base and better positioning us to deliver future growth, and we have the capacity and expertise at our Manchester facility to ensure that there is no impact on our customers as a result of any site consolidations.
"We will begin the consultation regarding the Eastleigh site closure in due course and will provide an update to the market following the conclusion of the process."
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