Britvic to combine GB and Irish businesses

Britvic proposes closing two manufacturing sites in the UK and concentrating production in Britvic Ireland’s Dublin plant at Kylmore Road where some €7.6 million has been invested in the facility in recent years.

Britvic is to create a combined GB and Ireland business unit under a single leadership team according to Britvic’s Chief Executive Simon Litherland in his Business and Strategy Review, part of the company’s Interim Results for the 28 weeks to 14th April this year.

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The Interim Report states that Ireland continued to be impacted by the performance of third-party brands in the wholesaling business.

The company intends “to transition to a simplifed organisational structure,” according to Simon Litherland, “Additionally we have identified a series of initiatives to achieve our strategy and step-change the cost base and profitability of the business.”
He proposes doing this by increasing operational leverage through fewer manufacturing sites by redistributing capacity, reducing the cost base and improving its asset utilization.

He states, “In our full portfolio markets of GB and Ireland we are proposing to combine both businesses, leveraging our scale and common strategy across both markets in a more cost-effective way”.

As a result the company proposes closing two manufacturing sites in Chelmsford and Huddersfield in the UK in the first Quarter of 2014 (with the loss of some 260 jobs there) and concentrating production in Britvic Ireland’s Dublin plant at Kylmore Road where some €7.6 million has been invested in the facility in recent years.

In addition, he states, “Ballygowan will replace current GB water brands, sourced from Ireland”.

It’s also proposed to separate the licensed wholesale division at Britvic Ireland from the core branded business and to close the Belfast warehouse at Castlereagh Road in the last Quarter of 2013 which could impact 18 jobs there should this go ahead.
This means that distribution activities would be consolidated for the Island of Ireland at Britvic Ireland’s Nangor Road facility in Dublin.

“We offer a broad portfolio of brands and the relationship with Pepsi will continue to be an integral part of our success,” stated the Chief Executive, “We will invest and innovate to exploit our brand leadership of the Kids, Family and Adult categories. Our objective is to establish a platform resulting in GB and Ireland delivering sustainable market leading value growth.”
In the 28 weeks ended 14th April 2013, Irish revenues accounted for £67.2 million, down 5.5% on a constant currency basis from the same period in 2012 of £72.7 million.

According to the Intermim Statement, “The Irish market remains challenging; however our own brands continued the recent quarter’s improved performance by outperforming the market again. Whilst our overall volumes declined 5.6% we successfully grew value share and held volume share in the take-home market as measured by Nielsen”.

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