Sector News

Arla to close several UK sites as part of cost-saving initiative

May 30, 2018
Food & Drink

Arla Foods has announced that it will close several UK sites and restructure its corporate group functions as part of the company’s Calcium cost-saving programme.

Responding to the company’s exposure to the British pound and unfavourable developments in commodity markets, Arla says that it will close its Llandyrnog creamery and its Malpas and Lockerbie packing facilities, which will put up to 154 jobs at risk.

Cheddar cheese production from the Llandyrnog creamery will be consolidated into its Taw Valley and Lockerbie creameries, while the company’s cheddar cheese packing operations will be integrated into its Oswestry packing site.

Meanwhile, the company will streamline its corporate operations and support functions, such as finance, legal & IT, corporate strategy, member relations, HR and corporate affairs.

195 employees are expected to be made redundant, predominantly at the company’s head office in Aarhus, Denmark, but will also affect some corporate roles in Arla’s other European administrative offices.

The changes comes as Arla seeks to save up to more than €400 million by the end of 2020 through improved efficiency in all areas of the company as part of the Calcium initiative, which was implemented last month.

CEO of Arla Foods, Peder Tuborgh said: “We want to achieve the goal of building a stronger, more competitive Arla, which serves our customers and consumers better and provides higher returns to our farmer owners and that requires us to make tough decisions.

“In order for Arla to continue to deliver on our Good Growth 2020 strategy that brings innovative dairy products to millions of consumers around the world, we must become one of the most agile and frontline-obsessed companies in today’s fast-paced and complex global food industry.

“It is never easy to say goodbye to valued colleagues, especially in these circumstances, and I would like to thank those people who are leaving us for the contribution they have made to Arla Foods, and I wish them well for the future.

“We will provide our full support to those colleagues affected during this process.”

Source: FoodBev

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