2nd May 2006 14:02
Communisis plc Consolidation of Direct Mail Manufacturing into Leeds Centre of Excellence Communisis recently announced a review of capacity within its direct mailbusiness due to the continued industry overcapacity and deflationary pricingwithin the direct mail market. This review has now been completed and as partof Communisis' strategy to focus on the development of world-class production`centres', Communisis is relocating all of its direct mail production to itsLeeds `centre of excellence'. Accordingly, production at its Altrinchamfacility will cease and current manufacturing activity will transfer to Leeds.It is expected that this transfer will be completed by the fourth quarter. Thecurrent Altrincham based sales, customer service, data bureau and reprographicteams will be relocated to Communisis' Manchester site and continue to supportexisting customers.It is expected that exceptional costs of ‚£6.0m (of which ‚£4.6m will be a cashcharge), comprising principally severance, property, disruption and assetwrite-offs, will be incurred in relation to the transition to the newoperational structure. These will be recognised in the first half. In addition,it is anticipated that capital investment of ‚£1.0m will be required to supportthe relocation. The cash payback on the exceptional charge is estimated atapproximately one year, the majority of which will be realised in 2007.The cash cost of the exceptional charge is expected to be funded out ofexceptional property profits, some of which have already been announced.For further information please contact:David Jones, Chief Executive Tel: 0113 277 0202Communisis plcMark Whiteling, Finance Director Tel: 0113 277 0202Communisis plcWilliam Clutterbuck Tel: 020 7379 5151The Maitland ConsultancyENDCOMMUNISIS PLCRelated Shares:
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