Bulmers to seek 121 redundancies by June

 

Cider-maker Bulmers is to cut 121 jobs, or almost a quarter of its staff, as part of a reorganisation plan announced this morning.

The company, owned by Irish drinks group C&C, employs 433 people in manufacturing in Clonmel, Co Tipperary, 46 commercial staff in Dublin and 70 people in Northern Ireland.

Employees were briefed on the plan this morning. The company said the job losses would be voluntary and that it wants the reorganisation completed “as quickly as possible” and by June at the latest. If the voluntary package is undersubscribed the company will impose compulsory redundancies.

C&C shares rose over 10 per cent on the news and at 2.15pm were trading at €1.01, a four-week high. The company’s stock has fallen by 76 per cent over the last year and at €1.01 has a market capitalisation of €320 million.

Aiden Murphy, managing director supply with C&C Group, told The Irish TimesBulmers was operating under “extraordinarily tough economic conditions and it is essential we reduce our cost base and restore our competitiveness. We know we are not competitive”.

He declined to give a figure for the cost savings arising from the changes or for the terms of the redundancy package, saying the company was in discussions with the unions.

“We are hoping that if the range of changes we have outlined are accepted, that we can safeguard as many jobs as possible,” Mr Murphy said.

Under the plan, C&C plans to restructure its sales force and merge its Dublin operations into one consolidated office.

The majority of the job losses will be sought from the company’s operations in Clonmel, where 103 jobs are to go, almost half of which will be management grade posts. Of the remainder, 11 jobs will be lost in Dublin and a further seven will go at its operations in Northern Ireland.

The company also met representatives of the Unite, Siptu and TEEU unions today.

Spitu branch secretary Nicolas Parker said after meeting management that while staff had been expecting some job losses, "there was considerable shock at some of the other proposals, including significant changes to shift allowances".

This is the second round of job cuts for Bulmers in less than three years and in the previous round at the end of 2007 approximately 150 staff left the company.

The changes followed an internal review initiated by new C&C chief executive John Dunsmore, who was appointed last November. Mr Dunsmore joined C&C from Scottish & Newcastle along with Stephen Glancey, who is now C&C chief operating officer and Kenny Neison, the strategy director.

In a statement Mr Glancey said: “While these decisions are deeply regrettable, they are essential to ensure that we improve our competitiveness in the face of current market challenges.”

The extent of the company’s difficulties were apparent in an statement last month in which C&C said revenues at its cider division were down 24 per cent in the UK and by 17 per cent in the Republic year-on-year.

Cider sales, its main business, were struggling due to weak consumer demand, two very wet summers and competition from new entrants into the cider market in both countries, the company said.

Cider revenues for the three months to the end of November 2008 were 19 per cent lower than the same period in 2007.

Tom Hayes, Fine Gael TD, said the uts were the latest in "a long list of blows which have confirmed South Tipperary as one of the worst unemployment black spots in the country.” He said unemployment rose in the area by 86 per cent over the last 12 months.