Cable price fall costs 500 jobs at BICC
Wednesday 21 October 1998
The cuts, which will cost pounds 25m in charges, include 200 redundancies as a result of the partial closure of a cable factory in Deeside, North Wales, which BICC announced in August. Most remaining job cuts will occur when BICC closes parts of its plant in Clayton, Australia.
Another 100 jobs were lost as Slimma, the womenswear manufacturer, revealed it was closing down a plant at Cannock in Staffordshire. The move means that products representing 75 per cent of Slimma's turnover will now be made overseas.
BICC said prices for its optical-fibre cable have fallen 10 per cent in 10 weeks to the point where only the most modern plants could make the cable profitably. "Prices have gone down more than we would have thought," said Alan Jones, the chief executive. "We had hoped for growth of 20 per cent but demand in Europe is very flat."
Shares in BICC slumped 14p to 42p - their lowest in the company's 35- year market history - as brokers cut profit forecasts to pounds 68m for the current year and pounds 79m for 1999, most of which will come from Balfour Beatty, the group's contracting division.
Mr Jones gave little hope of a speedy recovery. "The next two years will be difficult to predict," he said. The company hinted that it was looking at ways to boost its share price.
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