Oscar Mayer could potentially shed jobs at a one of its three UK factories to “ensure a long-term sustainable future” for the chilled ready-meals business.
Staff at the plant in Wrexham, north-east Wales, have been informed about possible redundancies, a spokesperson for Oscar Mayer said, explaining there are 135 jobs at risk but 101 new positions are also being created at the site.
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Should workers apply for those roles, the number of redundancies would fall to 34, the spokesperson added.
Oscar Mayer, a supplier of branded and private-label ready meals, announced in March last year that the company also planned to “downsize” its near-by facility in the town of Flint.
Of the 330 staff employed at Flint, some could potentially lose their jobs, while an undisclosed number of positions would shift to Wrexham, Oscar Mayer said at the time. The company’s other plant is located in Erith in south-east London.
In Oscar Mayer’s most-recent accounts filed with Companies House in December for the financial year to 1 April 2023, the company said 128 job cuts were “proposed” at Flint, while another 60 could move to Wrexham.
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By GlobalDataJust Food has asked the company for clarification on the numbers involved and how many workers actually lost their jobs, given Oscar Mayer said in the latest results filing that the switchover was completed last August.
The same filing showed Oscar Mayer posted a £22.1m ($27.6m) statutory net loss that year, wider than the £14.9m loss in the previous 12 months. The company made an adjusted operating loss of £17.2m, more than the £10.4m loss in the corresponding period.
Oscar Mayer, which is now majority-owned by Pemberton Asset Management, announced a new CEO in March in the form of Ian Toal.
In a statement provided to Just Food on the job negotiations taking place at Wrexham, Toal said: “These proposals are not made lightly but we believe are necessary to ensure a long-term sustainable future for our business.
“The UK chilled-foods sector remains highly competitive. For us to continue to compete and grow we have to take steps to become more efficient so that we can deliver on our strategy to innovate, expand the market and meet the changing demands of consumers and our customers.”
Oscar Mayer supplies major UK supermarkets and also the discount chain Aldi. Its brands include The Gym Kitchen, Fit & Prepd, Treat ‘n’ Eat and El Loco Cantina.
However, the accounts filing for the year to 1 April 2023 suggested Oscar Mayer met with some opposition to price increases, although they contributed 14% to group turnover.
Statutory turnover for the year was £343.9m, up from £295.8m in the prior 12 months. Gross profit was relatively flat at £25m versus £25.3m.
Oscar Mayer noted it had seen “significant margin pressure” from delays in recovering inflation and “some customers have not accepted all elements of inflation in our requested price increases”.
The company added in the December filing that “profitability has been improving since spring 2023 through a combination of operational improvements and further price increases.”
However, it said inflationary pressures in ingredients, packaging, energy and labour required the need for “cost reduction programmes”, while the business had seen a “general reduction in market consumption of chilled ready meals”.
Toal added on the Wrexham plans: “We don’t underestimate the impact of this announcement on our much-valued, hard-working team in Wrexham and will provide them with all the support we can, including offering alternative roles at our Wrexham and Flint sites, should these plans proceed as currently proposed.”
