More jobs are going down the drain.
Resins and chemicals maker Nuplex Industries, after an eight-month review of its operations and markets, said it is forced to close down four factories in New Zealand and Australia over the next two years.
In a statement to the NZX on Monday, the company said the affected factories are those located at Onehunga and its high-temperature plant at Penrose in Auckland, Canning Vale in Western Australia and Wangaratta in Victoria.
The company did not provide details as to the exact number of jobs to be affected. BusinessDay, however, reported eight per cent of the entire 800-strong workforce, translating to 64 positions, will be slashed. The closure of the four facilities will result in redundancy costs of $3.95 million, Nuplex said.
Other costs, Nuplex said, would be $8.05 million to write down obsolete equipment and clean-up, as well as site remediation of $4.35 million.
While it regrets having to cut down on the number of personnel, the decision was needed to ensure ensure the long-term sustainability of the business, Chief Executive Emery Severin said.
"We concluded that through streamlining our manufacturing network and investing to maximise the capability of our remaining operations, we can align our cost base to competitively produce our products in Australia and New Zealand," Mr Severin said.
"It is likely that demand levels in both the manufacturing and construction sectors will be lower than in previous economic cycles as manufacturing customers and their customers continue to move offshore due to the impact of the ongoing strength of the Australian and New Zealand currencies," he noted.
The full benefits of the restructuring would translate to $5.6 million a year, with the full benefits reflected in the 2015 year, Nuplex said.
"If they (Nuplex) can consolidate down their plants to other locations then that's probably the best thing to do," equities manager James Lindsay said in TVNZ.
"The manufacturing base of Australia and New Zealand is under pressure because of the high currencies and the weak economies," Mr Lindsay added.
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