Last checked at 27 Aug 2013 10:00
Renold plc
("Renold", "the Company" or "the Group")
Strategic Review Update
Renold, a leading international supplier of industrial chains and related power transmission products, today issues an update on its ongoing strategic review and the start of a consultation process with employee representatives at the Bredbury Chain plant in the UK.
In its full-year results announcement, issued on 28 May 2013, the Company set out initial findings from its review of the overall business model including a key strategic objective to lower the Group's breakeven point. The Company also announced that the review of the Chain Division's manufacturing operations had identified significant levels of excess capacity. The financial results for the year ended 31 March 2013 included the impairment of £9.4m of assets directly related to that excess capacity.
The Company has extended its analysis to examine whether or not there is a concentration of excess capacity within a particular location and to establish whether there are options to reduce the manufacturing footprint and cost base.
In recent years, the Bredbury plant in Manchester has experienced much lower activity levels and incurred significant financial losses. As a result, the analysis has concluded that the Bredbury plant is not economically viable. The Company therefore will initiate today a formal process with employee representatives to consult on a proposal to close the site.
Robert Purcell, Chief Executive of Renold plc, said:
"We know that this will be a period of uncertainty for our staff at Bredbury and we are committed to consulting fully with our employees and their representatives. We do however have a pressing need to reduce our cost base if the Group is to realise its future potential."
27th August 2013
ENQUIRIES:
Renold plc | |
Robert Purcell, Chief Executive | 020 7457 2020 |
Brian Tenner, Finance Director | |
Arden Partners | 020 7614 5917 |
Chris Hardie | |
College Hill | 020 7457 2020 |
Mark Garraway | |
Helen Tarbet |
NOTES FOR EDITORS
Renold is a global leader in the manufacture of industrial chains and also manufactures a range of torque transmission products which are sold throughout the world to a broad range of original equipment manufacturers and distributors. The Company has a well-deserved reputation for quality that is recognised worldwide. Its products are used in a wide variety of industries including manufacturing, transportation, energy, steel and mining.
Further information about Renold can be found on the website at: www.renold.com