Premier Foods announced this week that they are closing its site in Knighton, Staffordshire amid non-profitability. Subsequently, the shutting down of this facility has put more than 300 jobs at risk.

Closure will cost £10 million

Premier Foods has proposed to close its Knighton Foods powdered desserts and drinks factory. Moreover, The Knighton Foods plant manufactures private-label powdered drinks. The company announced that the Knighton’s plant is not aligned to the group’s branded growth model strategy and is marginally unprofitable at trading profit. Furthermore, Premier Foods announced that the move will cost them about £10 million. However, However, Premier Foods is expecting a boost in group trading profit on the back of the decision to shut down Knighton facility.

300 jobs are at risk

Premier Foods is employing more than 4,000 workers which are located across 15 locations across the country. The closure of its facility in Staffordshire means that around 300 jobs are at risk. However, the company has already launched a consultation with the 300 potentially affected employees. The consultation process is likely to conclude by the middle of 2023. However, the production facility will remain functional by 2024. “It is recognized that this will be an unsettling time for those 300 colleagues who are potentially affected by these proposals, and they will be fully supported and consulted with throughout the process.” The company said in a statement.

Strong financial results in later 2022

Surprisingly, the decision came on back of strong financial results in successive quarters for the company. In the last quarter of 2022, Premier Foods group sales grew by 12% compared to 2021. Similarly, the grocery sales rose by 17% and international sales went up by 10%. “These results illustrate the continuing appeal of our portfolio of market-leading brands in such a challenging environment and demonstrate the strength and resilience of our branded growth model.” Alex Whitehouse, chief executive of Premier Foods said in a statement.

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