North Lanarkshire sausage skin factory to close

A North Lanarkshire factory is expected to close next year, with the loss of around 90 jobs.

It is reported Devro, which makes sausage skins, updated investors on the fate of its Bellshill site this morning.

The company also has a plant in Moddiesburn. It has been on the receiving end of £2million of investment in the last three years and is to stay open.

The company said: "In line with our strategic priorities, the Group has undertaken a review of its global manufacturing footprint with the aim to pursue further efficiency improvements, as well as to align available capacity to the Group's growth ambitions.

"As a result of this review we are proposing to close our Bellshill site in Scotland and, consequently, to increase the portfolio of products manufactured in our Moodiesburn site in Lanarkshire and relocate some of the Bellshill's manufacturing assets within the wider Group. Following consultation, we expect Bellshill to close during 2020 with the loss of c.90 employees.

"An exceptional cost of £15m (£10m of cash) will be incurred (2019: £11m exceptional profit and loss charge, £1m exceptional cash charge; 2020: £4m exceptional profit and loss charge, £9m exceptional cash charge).

"The investment associated with these actions is within our longer-term capital programme and, as such, our capital expenditure guidance for FY 2020 (£18m) remains unchanged. This review has identified annualised cost savings of £5m to be fully realised in FY 2021.

"Additionally as part of the global manufacturing footprint review and the intended closure of Bellshill the Group is analysing its ongoing supply strategy. This is expected to result in non-cash exceptional impairment charges in FY 2019, primarily relating to partial write-downs of the China and US plants.

"These plants continue to be an integral part of our global footprint and the revised supply strategy will enhance the agility and flexibility of the Group's supply chain whilst staying focussed on our long-term growth ambitions."

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