HKScan restructures poultry production set-up in Denmark

HKScan Group, a Nordic meat company has announced plans to restructure its poultry production capacity in Denmark, where the Group has production facilities in Vinderup and Skovsgaard.

The restructuring will centralise poultry slaughtering and cutting at the modern Vinderup facility. The investments and rebuild completed at Vinderup over the past two years have increased HKScan’s slaughtering and deboning capacity, resulting in excess capacity. Packaging and warehousing will remain based in Skovsgaard. Scheduled for completion by the end of March 2015, the restructuring will result in a net headcount reduction of approximately 85-95 employees in total, involving reorganisation both in Skovsgaard and Vinderup.

The targeted annualised cost reduction and profit improvement is in excess of €5 million, including efficiency measures related to the production restructuring. The impact is targeted to materialise from the second quarter 2015 onwards. The restructuring causes a non-recurring cost of €1,6 million, which will be reported in the fourth quarter of 2014.

“We need to adjust our production capacity in line with market demand. At the same time, cost reductions are required. We want to get our Danish operation back in balance after the rebuild following the fire of June 2012 and start investing in growth opportunities. We are confident that by realising the plan, we can improve capacity utilisation and create a competitive cost base and new opportunities for profitable growth. HKScan is committed to developing and investing in Danish business and production,” says Anders Jeppesen Jensen, general manager of HKScan Denmark.

HKScan is the largest poultry company in Denmark with net sales totalling €225 million in 2013 and approximately 750 employees. The company sells, markets and produces poultry-based products mainly under the well-known Rose brand, which is also exported widely.