Finsbury to shut pastry factory

Bakery products supplier Finsbury Food Group confirmed yesterday that it is to shut its loss-making Grain D’OR pastry plant resulting in the loss of 250 jobs.

Following a consultation with employees and union representatives, the group said it would be closing the Brent-based operation by 2 December.

Finsbury – a major employer in Scotland with hundreds of staff across its Lightbody cakes business in Hamilton and Johnstone’s in East Kilbride – said in a stock market statement: “The company has engaged extensively with employee representatives to carefully consider the future of the business, however no viable alternatives to closure have emerged.

“As a result, 250 employees are at risk of redundancy at its London site.”

The firm said it will try to offer affected workers alternative employment in other group locations and has entered consultations with those affected.

Finsbury acquired Grain D’OR as part of its takeover of the Fletcher Group of Bakeries in 2014 but the business has faced cost pressures and rising competition. During the 12 months to July of this year, Grain D’OR generated some £28.5 million in revenue but booked an overall operating loss of £3.3m.

Finsbury is expected to take an exceptional cash cost associated with the closure of Grain D’OR of up to £10m. When the original announcement was made during the summer, the Bakers, Food and Allied Workers Union blamed the closure in part on the failed renewal of key supermarket contracts – with the likes of Marks & Spencer and Sainsbury’s – that accounted for about 60 per cent of Grain D’or’s volumes.