Wiseman confirms plan to close milk distribution depot

Published on Wednesday 26 January 2011 21:54

ROBERT Wiseman Dairies said its turnover and profits remain in line with expectations but has confirmed plans to close a depot in Fife.

Up to 68 jobs are under threat at the company's distribution depot at Cupar, Fife after a 30-day formal consultation on closing the site began this week.

Wiseman warned in November that supermarket milk price wars might impact its profits. In yesterday's interim management statement, it added that diesel and plastics costs had risen 10 per cent since September, but the company was confident it could sustain net debt at its previously reported level and still fulfil its capital expenditure plans for the year.

Broker Investec forecasts revenue for the year to the end of March of 918 million for the company, and profits of 36m.

Graeme Jack, communications director at Wiseman, said that the company, which sells about two thirds of its fresh milk to large supermarkets, was well positioned to cope with the "intense competitive pressure", thanks to a "robust balance sheet" and the 450m investment it had ploughed into its dairy and distribution network.

The company said the completion of work to upgrade its huge facility at Bridgwater in Somerset had helped it cope with the recent adverse weather, and allowed an easing in volumes processed at other dairies, as well as a reduction in the level of overtime worked.

A milk processing operation at Okehampton in Devon, close to Bridgwater, was also made subject to a consultation on closing by the company this week.

The 30-day consultation on the future of the Cupar depot will end on 25 February, at which point the company will complete a strategic review before arriving at a decision.

The company said that should Cupar close, some staff may be offered the opportunity to transfer to distribution roles at its sites in Aberdeen or Whitburn, West Lothian.