ForFarmers wants to relocate the production of animal feed from the British Crewe to other locations in the United Kingdom. It concerns the elaboration of previously announced efficiency improvements that should save 10 million euros in 2021 compared to 2018.
The animal feed company looks at what needs to be done with the employees involved. A consultation round on that is still ongoing. 23 people are being dismissed.
ForFarmers now has fourteen production sites in the United Kingdom. The volumes produced in Crewe are relocated to the nearby locations in Newcastle under Lyme, Selby and Preston. The fate of the factory in Crewe is not yet clear.
The fact that ForFarmers wants to relocate the production of feed from the British Crewe to other locations in the United Kingdom as part of an efficiency boost has already been priced into the valuation of the share. KBC Securities reported this in a report on the company.
Interventions at ForFarmers must provide the company with structural savings of 10 million euros by 2021 compared to last year. According to KBC, ForFarmers cannot fully pass on higher costs for logistics, energy and raw materials to the farmers. Partly as a result, the results for the first six months of the year will be disappointing. KBC is again counting on improving results from next year.
KBC maintained its accumulate advice with a price target of 8.50 euros. The share was quoted at 7.48 euros on Thursday in the opening minutes.