Rakon plans to close UK plant

Last updated 10:03 16/01/2014
RAK 0.200 0.00 0.00%

Click for a detailed chart

Relevant offers


Weight Watchers campaign joins list of PR blunders Skills shortage results in firms looking internally to fill roles, recruitment firm says Pumpkin Patch in trading halt - too much debt, not enough capital British American Tobacco offers to buy Reynolds in US$47 billion deal Backlog of defective buildings and shoddy workmanship sparks calls for building warranties Ikea NZ Facebook page set up: Is it finally coming to NZ? Auckland Council and contractors ordered to pay $120,000 to the family of killed rubbish truck worker 71yo asked to stand on hot water cylinder to plug in phone after bizarre UFB install Tuanz welcomes Vodafone offer to keep internet users connected Travel companies adapting to 'luxury' demands of young travellers

Listed electronics components manufacturer Rakon is planning to close its factory in Lincoln, Britain, and shift the manufacturing of products made there to its New Zealand plant.

The proposal follows a review which determined that duplicate overhead structures and manufacturing capability existed between the Lincoln and New Zealand operations, the company said.

The proposed closure had no fixed timeline. The company planned to continue to maintain a research and development centre in Britain, based at Harlow, Rakon said.

Rakon chief financial officer Simon Bosley said it was too early to say whether any new jobs would be created in New Zealand as a result of the shift.

The Lincoln plant employs 88 people and manufactures the Pluto product range, which is also manufactured in New Zealand.

Should the proposal be confirmed in the current financial year, Rakon said its earnings guidance for the 2014 financial year would be amended.

The company would then expect to report an operating loss of from $5 million to $8m, compared with the previous guidance for an operating loss of between $3m and break-even.

Net loss after tax would be expected to be from $55m to $59m, compared with the previous guidance of $54m.

Rakon said the proposal did not affect its target to reduce bank borrowings to below $12m by March 31 and its previously announced forecast of an operating profit of from $10m to $15m in the 2015 financial year remained intact.

Ad Feedback

- Fairfax Media

Special offers

Featured Promotions

Sponsored Content