Croda adds to Wirral jobs woe

CHEMICALS business Croda has announced plans to close its factory on the Wirral with the loss of 115 jobs.

The listed group, which has its headquarters in Yorkshire, said it will shut the industrial chemicals site in Bromborough as part of a strategy to reduce its exposure to basic commodity sectors.

The decision comes a month after Danish Crown confirmed it was shutting its meat processing factory in Bromborough, making 300 staff redundant.

Croda took control of the factory, pictured below, in 2006 as part of its £410m acquisition of ICI subsidiary Uniqema.

The business made a £2.1m operating profit on turnover of £45.3m last year, but Croda said these figures were “flattered” by favourable glycerine prices and the site made a loss in the final quarter.

The closure of the factory will cost Croda around £40m, made up of an exceptional write-off of £30m and an exceptional cash closure cost of £10m, although it said the latter would be “significantly offset” by the release of working capital.

In a first quarter trading statement the Goole-based firm, which supplies some of the world’s best known skincare and cosmetics companies such as L’Oreal, Chanel and Procter & Gamble, said basic commodity sales were down by some 20% with the division making a £2.6m loss.

Sales at its industrial specialities business also slumped 20% but the group’s core consumer care business prospered, increasing sales by 26.6% to £133.7m. Operating profit grew 37% to £28.9m.

Chairman Martin Flower said: “We expect the weakness in commodity and industrial markets to continue over the coming months but also anticipate continued sales growth in consumer care and this, allied to ongoing cost savings and favourable raw material pricing in some sectors, gives us continued confidence that we will make further progress in 2009.”