BRITAIN’S BIGGEST food group Premier Foods plans to slash 600 jobs in the UK in the face of weak consumer demand and expects 2011 profits at the lower end of the market forecasts that were already cut back in October.
The group, which owns top brands like Hovis, Mr Kipling and Batchelors, added yesterday that trading over the Christmas period was in line with expectations.
The job cuts amount to an acceleration of an existing cost-cutting plan and follow a profit warning in October. They will be made from Premier’s 12,000 workforce across head office, support sites and production plants, and will double its cost-cutting target to more than £40 million by 2013 from its original plan for £20 million.
The company, struggling with hefty debts after a buying spree and tough trading conditions, said talks with its banks over a refinancing package are continuing and an agreement is expected soon while it looks to sell more non-core businesses.
“The group is making the right noises but has a long way to go to tempt shareholders back. Details of the refinancing will be crucial,” said analyst Charlie Mills at brokerage Credit Suisse. – (Reuters)
