Northern Foods’ major plant investment leads to job losses

11 November, 2009

Northern Foods has announced it is to plough £26.5 million into its Fox’s Biscuits brand in an investment that could see new automated technology replace hundreds of jobs.

In order to “ensure it has the most appropriate biscuit facilities to remain competitive”, Northern Foods will introduce automated technology at its Batley, Kirkam and Uttoexter sites, resulting in a reduction of approximately 220 employees. According to the firm these will be “mainly through voluntary redundancy”.

In a statement of its half year results, it said key investments over the next 18 months would include a new Creams line at Kirkham, new automation for its Melts line at Batley and a new wrapping system at Uttoxeter. However, it said its overall objective was to “transition” from three sites to two.

“Once this current investment is completed in the first quarter of our 2011/12 financial year, further phases of investment will be benchmarked against those investment opportunities available to Northern Foods at the time,” read the statement.

Like-for-like sales for the 26 weeks ended 26 September 2009 grew 2.9%, with strong growth in its Chilled and Bakery divisions. Total sales hit £466.9m (H1 2008/09: £468.6m).

Within Chilled, its sandwich sales were driven by the early summer weather, its new discount range for Tesco, and other customers plus additional sandwich volumes supplied into Marks & Spencer.

Divisional revenue within Bakery rose 3.9% with profits up 26.2% to £8.2m (H1 2008/09: £6.5m). A planned £2m spend on a marketing campaign for its Matthew Walker pudding brand will be launched ahead of the Christmas period.


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