McBride to close Italian factory
SHAMPOO to mouthwash maker McBride, which has sites in Bradford and Hull, is to spend £15m on closing down one of its Italian factories near Milan.
Italy is the group’s second largest market in continental Europe but in a statement it said it would save £2.5m a year after 2013 if it moved production to other sites in the country.
Last year McBride focused on UK costs, cutting 60 jobs from its 600-strong workforce in Manchester and closing a Warrington facility with the loss of 100 jobs. It also runs facilities in Barrow, St Helens and Burnley, and has sites in Yorkshire at Bradford and Hull.
The company, which makes a range of own-label toiletries and household products for retailers such as Superdrug and Marks & Spencer, saw sales and profits rise in the six months to December 31.
During the period revenue rose 5% to £412m, mainly due to favourable currency exchange rates. Pre-tax profits jumped from £5m to £22.5m.
Revenue increased in all divisions with sales from UK operations up 1% to £162.4m. Western continental Europe saw a 9% lift, helped by 8% growth in France and Italy where McBride said its private label business had been helped by the erosion of brand loyalty.
However sales in Spain plunged by 19% driven in part by a decision to exit low margin commodity products. In Eastern Europe sales rose 3%.
Chief executive Miles Roberts, said: “These results demonstrate that our private label strategy, which focuses on growing higher margin products, operational efficiencies and tight cash management, is working well.
“There has been good sales growth in our core categories including personal care. All our divisions have posted higher operating profits and returns. Net debt has reduced to £69.4m and we are pleased to announce an 18% increase in our interim dividend.”
McBride said it was operating in a “highly competitive market” but has been trading in line with expectations since December.
The group has credit facilities of £175m, committed until February next year, and has been in talks with a number of banks about a future refinancing. New long-term facilities should be in place by June.
The interim dividend per share is up 18% to 2p.
