TORONTO, April 16, 2013 /CNW/ - Canada Bread Company, Limited (TSX: CBY) today announced plans to close its bakery in Shawinigan, Quebec. The closure will improve efficiencies in the Company's network by reducing overhead and supporting a focus on higher margin products and new market opportunities.
The Shawinigan bakery produces a variety of snack cakes under the Chevalier, Cadbury and Obsession brands. Seventy four employees will be affected when the Company closes the facility on May 3, 2013.
"We have experienced a significant decline in consumer demand for snack cakes in recent years," said Richard Lan, President and CEO, Canada Bread. "We are conducting a strategic review to identify category expansion opportunities. Based on the outcome of this work, there could be potential in the future to utilize this plant to support other manufacturing requirements. However, based on declining capacity utilization we have no alternative but to close the facility. We deeply regret the impact this decision has on our people and are committed to supporting their transition to new employment."
Closure costs to be incurred in 2013, including severance, decommissioning and asset write-downs are expected to amount to approximately $3.1 million before tax, $1.6 million of which represents cash expenses.
Canada Bread Company Limited, which is 90% owned by Maple Leaf Foods Inc. (TSX:MFI) is a leading manufacturer and distributor of fresh bakery products, frozen par-baked products and fresh pasta and sauces. The Company had 2012 sales of $1.6 billion and employs approximately 5,500 people at its operations across North America and in the United Kingdom.
SOURCE: Canada Bread Company, Limited
Investor Contact: Nick Boland,
VP Investor Relations: 416-926-2005
Media Contact: Dave Bauer,
905-285-1510
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