Dairy manufacturer to close two factories with 260 jobs set to go
Based in Surrey, the UK firm is to close a milk glass bottling plant in Hanworth, west London, and a cream potting facility in Chard, Somerset as part of moves to save €25m a year.
The maker of Cathedral City cheese and Country Life butter also warned that its dairies business would post a loss in the six months to September 30.
Dairy Crest said its Hanworth bottling plant, which employs around 200 people, will remain operational for two years before closing.
The firm said the site has suffered from consumer preference for buying their milk in plastic containers rather than in glass bottles.
The business points out that in 1975, around 94% of milk came in glass bottles, but this had fallen to just 4% by 2012.
It has closed several dairy factories in recent years as it seeks to control costs in this area of the business. The company told its 1,400 milkmen and women that it was doing all it could to maintain its doorstep delivery business.
But it added dairy markets have been extremely volatile, with cream prices down 40% from last autumn’s peak and both cream and skimmed milk power prices falling 15% last month. Shares fell more than 3%.
Dairy Crest will shut its Chard facility, which employs around 60 people, in the second half of 2015 as the firm said it was not economically viable.
Chief executive Mark Allen said: “The decisions to consult on the closure of our Hanworth and Chard sites have not been taken lightly, but they are right for the long-term future of the business as a whole.”
Dairy Crest added that sales of its four key brands — Clover, Cathedral City, FRijj, and Country Life — grew 4% in the first quarter to the end of March versus a year ago.
