21 jobs axed as Annies hits trouble
Marlborough fruit bar manufacturer Annies has gone into voluntary receivership with 21 job losses.
Receivers Price Waterhouse Coopers said the company would continue to trade, but cuts had been made while the business was in receivership.
Staff were told on Friday, and 21 of the 53 workers at the company have lost their jobs.
PWC partner John Fisk said Annies had one customer in the United States unhappy with the wrapper on an order of 4 million fruit bars. The cost of returning the bars to Marlborough and re-wrapping the product was too much, and could have made the company insolvent, he said.
The company's board took advice and put the company into voluntary receivership.
Mr Fisk said the receivers were looking to sell it as a going concern and this could be an opportunity to take the company to the next level. "It is a good business, a good product."
Mr Fisk said the receivers were working with the United States customer to "see if we can find a solution that will work for all parties".
Owners Annie and Graeme Giles said yesterday the situation was "very sad".
"Friday was one of the hardest days of our lives . . . the pain that people are going through hit us very hard."
Mrs Giles said the biggest message the couple wanted out there was that the business remained viable and continued to trade.
"We are open for business. We are providing all our customers in New Zealand and Australia. It doesn't affect our customers."
Receivers understood the inherent value in the business, Mrs Giles said, and they continued to trade. "We can undergo a recapitalisation and new investors are to be sought. There is the potential of a sale . . . it's extremely sad."
Mr Giles said the receivers had told them there was a lot of interest in the company.
There were no health and safety issues with the wrapper problem, he said. "It was quite a minor labelling problem, if you looked at it, you'd almost not see it."
He said options such as getting extra investment or bank deals were considered but the biggest problem was the "pretty short" timescale.
Mrs Giles said the impact on the company's cashflow was not sustainable.
"The size of the order, and impact on cashflow, and the time it was going to take to get it, re-wrap it and get it back on market . . . that's not a sustainable situation."
It would take five months to return the 4 million bars and re-wrap them and return them.
"In the middle of this, we haven't lost [the] customer, they simply want it re-wrapped. The time taken to do that is longer than the cash available to sustain the company in its current form."
Mrs Giles said they could not in good conscience continue to trade the business and carry further liabilities. Instead, they had gone into voluntary receivership and were working with the receiver to rebuild the business. There had been a reduction in production with the receivership, and the receivers had made the decisions on staffing.
"It's sad we've lost staff . . . it's certainly never a position we ever thought we would be in.
"We have been 26 years in Marlborough. Annies has been a successful business for that time."
She and Mr Giles were very much involved in the company. She had taken up the position of managing director, and they were working hard to get the business back on track.
- The Marlborough Express