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HKScan to Cut Jobs in Sweden

18 September 2009

SWEDEN - HK Scan has drawn up major structural streamlining plans for its Swedish subsidiary Scan AB by the end of 2010.

The reorganisation is expected to bring benefits of €30 million.

An investment of €12 million is to be made over the same time in the Swedish business. The measures would give rise to non-recurring charges of roughly €5 million.

The plan is designed to achieve HKScan’s EBIT target of five per cent of net sales in its Swedish business.

In the current and coming year, Scan is to be moulded into an increasingly profitable venture while also making it an even more attractive and innovative partner for all of its stakeholders.

Scan is already a leading player in its field in the Swedish market, and the plan now announced will provide an even stronger platform for future growth and performance.

According to the road map, Scan would discontinue its production in Uppsala and at Kreatina AS, a company based in the Danish town of Bjaeverskov.

Production in Skara would also be scaled down considerably. The slaughter and cutting of beef and lamb would be centralised to Linköping, while the majority of pork slaughter and cutting would take place in Kristianstad.

The ground meat products business of Linköping-based subsidiary Esca would be transferred to Skara, where some pork slaughter operations would also remain. The production of consumer packed meat would transfer from Uppsala to Linköping. Collaboration would be explored in 2010 in respect of operations in Visby.

Negotiations with the labour market parties aiming at implementation of the road map have been started and Scan will commence employer-employee negotiations on cutting roughly 400 jobs. Implementation of the road map would cut Scan’s workforce from the current 3,000 to roughly 2,500. The potential job cuts would concern Skara, Uppsala and Kreatina AS in Bjaeverskov, Denmark.

Upon implementation of the road map, Scan may be able to offer some employees jobs in Kristianstad and Linköping, i.e. the locations where production would centre.

Employer-employee negotiations on cutting 95 white-collar jobs have already been started earlier and concern employees at all of the company’s locations.

The focus in business development at HKScan is now squarely on Sweden. The reorganisations and streamlining already completed in the current year have delivered higher profitability and stronger market standing. Scan has in place in Sweden both new executives and a new management system. The company is thus well poised to successfully follow through on the road map now announced. The scope of Scan’s business along with its firm market leadership and leading brands provide a solid foundation for these steps.

TheMeatSite News Desk

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