Britvic refuses to rule out job cuts

BRITVIC said it is committed to the Irish market despite fears of jobs losses and pay cuts in the new year following a restructuring of their Irish operations.

The company intends to announce its plans for the restructuring of its Irish operations in the coming months and it refused yesterday to rule out job losses among its 800-strong workforce in Ireland.

The drinks firm is, however, pushing on with plans to invest in Ireland and will launch the popular US drink, Mountain Dew in March or April next year.

Britvic booked a one-time impairment charge of £104.2 million (€123.6m) on the value of Britvic Ireland’s intangible and property assets, in addition to a £5.7m (€6.7m) restructuring charge.

Chief executive Paul Moody said he didn’t expect any “near-term” changes in the value of the Irish business that would require further write-downs.

Irish management are in talks with employees and their unions about changes at the business.

“We want to refocus the business for the Irish market. No one clearly anticipated the economic downturn and Ireland has felt it more keenly than other markets. This is not a quick fix,” said Mr Moody.

He also said the country’s recent bailout will bring stability, but also present new challenges.

On a group level Britvic reported its first full-year loss in at least seven years on writedowns and restructuring charges at its Irish unit.

Britvic posted a net loss of £48.2m in the 53 weeks ended October 3, compared with a profit of £46.8m for the 52 weeks ended September 27, 2009. Revenue climbed 16% to £1.14 billion, after the May acquisition of Britvic France.

Britvic spent about €249m in 2007 to expand into Ireland by buying C&C’s soft-drink unit.

The company, which owns MiWadi and Robinsons said the Irish market is fragile but said it will invest in its brands here next year. It said Ballygowan pink performed well. It also said the Irish market was hit by the downturn in construction with less people making impulse purchases.

The company said the Irish soft drinks market has come under “severe pressure”. Fiscal sales in Ireland to September 30 fell 5.4% year-on-year and earnings before interest and taxes were down 42.4%.

Britvic said the structural category deflation seen this year in Ireland, as well as unprecedented levels of promotion in the market, have also had an impact on pricing.