Jim Jaffray, managing director of the ANM Group Meat Division, informed staff of the possible job losses at a meeting today. The plant employs 159 staff.
In addition to the potential redundancies, the company is to move to a one slaughter team process, incorporating cattle, sheep and pigs, within the next few weeks.
Chief executive Pat Machray said: “This is the start of the process to make our meat operation more efficient and more effective. I said at our AGM that there were no easy answers and unfortunately these actions are necessary to help put Scotch Premier Meat back on a sound footing. I regret this involves peoples’ livelihoods but have no choice in the current climate.”
Jaffray, who joined the company from Vion in December 2011, said: “We are remodelling the business into a shape that makes it more competitive in the current marketplace. We are confident we can return the business to a sustainable operation, although unfortunately this does involve looking at our staffing costs.”
The company confirmed that the consultation process, which will begin immediately, will look at possible ways of avoiding or reducing the number of redundancies. However, it confirmed that if these are deemed necessary, those affected will leave the company in early June.
The meat division of ANM reported substantial losses during 2011, blaming a lack of consumer confidence and greatly increased costs in raw materials, which had a “devastating effect on trading conditions”. It struggled to recover the increased price of beef from its customers and announced a programme of extensive change to stabilise the business.
Machray, who was appointed chairman after Alan Craig stepped down in February, warned members at the AGM there was no easy solution to the problems facing the meat division and it would take time to restore the business to profitability.
Scotch Premier Meats saw losses increase from £18,000 in 2010 to £1.79m in 2011, with Yorkshire Premier Meat reporting a loss of £1.387m, following a £568,000 profit in 2010.
In February, the company had announced the closure of the Yorkshire Premier’s Sheffield site because of the unsustainable level of losses, and operations were transferred to its South Kirby plant. A month later, it announced the sale of cooked meat business Charcuterie Continental to Scottish food group A.P Jess, following a loss of £785,000 during 2011.
However, ANM’s meat trading losses were offset by profit in the group’s core livestock business Aberdeen & Northern Marts, whose profits increased to £1.223m from £879,000. The Group said it remained in a “strong financial position” despite overall losses of £2.517m for the year ending December 2011.