Enodis warns of tougher US trading

The faltering recovery at Enodis was upset yesterday after the cooker and fridge maker warned of tougher trading conditions in the US as it unveiled a management shake-up and plans to axe 100 jobs.

The group said the poor outlook for the fast food industry – highlighted by problems at McDonald's – would hit second-half profits at its food service equipment division in the US, which supplies chains from Starbucks to Pret A Manger with ovens. Its shares fell 2p to 31p.

Enodis also announced plans to relocate its chief executive from London to Florida, in the US, where it generates three-quarters of its revenues. The upheaval would result in an exceptional charge of £4.5m, of which £1.7m would fall in the first half, it said.

Andrew Allner, the current chief executive who has spearheaded the group's revival via a refinancing and disposing of non-core assets, will step down in June, citing "family reasons" for not wanting to move to America. Mr Allner was on a one-year contract and will receive a pay-off worth £700,000. He will be replaced by Dave McCulloch, the chief operating officer.

Peter Brooks, the chairman, said it was inefficient to have a chief executive based in London, while Enodis' global operations centre is in Tampa, Florida. He said the job cull, which is part of an initiative to save up to £9m of costs planned for the second half, would affect about 10 per cent of its "salaried staff". The action would mean a full-year saving of £13m, he said. A further exceptional charge of £2.5m would relate to property liabilities.

In a trading update, Enodis said adverse foreign exchange movements and the effects of disposals would mean second-quarter operating profits would lag last year's although they would be in line on an underlying basis.