March 22, 2005
Cloetta Fazer to close subsidiary in Poland
Cloetta Fazer will close its subsidiary in Gdansk, Poland, during 2005. Consultations with the labour unions will commence immediately after Easter and are expected to close before the end of April 2005.
Cloetta Fazer will continue to sell its brands on the Polish market through collaboration with a local distributor.
Cloetta Fazers Polish subsidiary has recorded losses for the past few years, mainly due to a weak market position and a tough price competition. Under these market conditions, it has not proven possible to operate a profitable production and sales company.
Cloetta Fazers strategy is to focus on the Groups strongest brands. We will continue to market and sell our prioritised brands on the Polish market through a local distributor. In the future, the Polish market will be supplied by the Groups units in Finland and Sweden. Together, these measures will provide a more cost-effective solution, adds Karsten Slotte.
The Polish subsidiary reported net sales of MSEK 169 and a profit after net financial items of MSEK 10 in 2004, and is expected to show a loss throughout the remainder of 2005. Added to costs arising from the wind-up of the subsidiary, this will have an estimated negative impact on the Groups earnings of around MSEK 50, of which around MSEK 20 will not affect cash flow.
The number of employees in Cloetta Fazer Polska is 320. Union consultations will be started immediately after Easter and are expected to be finalised before the end of April 2005.
Cloetta Fazer has been active in the Polish market for several years. Until now, the Cloetta Fazer products sold in Poland have also been manufactured locally. The total production volume in 2004 was 5,500 tonnes, down by 20% from the preceding year.
The local management and employees in Poland conhave made an ambitious effort to reverse this negative trend, and it is deeply regretful that we now have to make this decision, says Karsten Slotte, CEO of Cloetta Fazer and President of the Supervisory Board of Cloetta Fazer Polska.
About Cloetta Fazer
The Cloetta Fazer Group is the Nordic regions leading confectionery company, with a market share of around 22 per cent. The company has production facilities in Sweden, Finland and Poland. Cloetta Fazers strength lies in its many popular brands, such as Fazer Blå, Kexchoklad, Dumle, Geisha, Polly and Center. The average number of employees is around 2,000 and annual sales in 2004 amounted to approximately SEK 3 billion.
Managing Director & CEO Karsten Slotte
mobile +46 70-687 99 22 or
Curt Petri, Chief Financial Officer
mobil +46 70 593 21 69
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