Royal Doulton plans £18.9m rights issue
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Your support makes all the difference.Royal Doulton, the fine china group, is cutting 1,000 jobs including 500 in the UK as part of a restructuring programme that will be funded by an £18.9m rights issue.
The UK jobs will go at the group's Baddeley Green site in Stoke-on-Trent which produces the Royal Albert range. The plant will be closed this year and production shifted to Indonesia. The other jobs will be lost in the closure of 100 Royal Doulton stores around the world. The group will invest £6m in the best of its remaining outlets.
Loss-making Royal Doulton has been struggling against a tough market for formal tableware and a high overhead structure. It has already cut 1,300 jobs in little more than a year and the latest redundancies will bring the group total down to 3,400. The business has sold operations such as Caithness Glass and Royal Crown Derby.
The restructuring is designed to cut production costs by 20 per cent, overheads by 30 per cent and stocks by a further 25 per cent. It came as the group announced slightly reduced operating losses of £12.4m before exceptionals, for the year to December. This compares with £14.7m the year before.
The £18.9m rights issue will be priced at 8p a share, compared to yesterday's closing price of 10.5p, down 3.25p on the day. The fundraising is fully underwritten by Cazenove for a fee of £31m. The proceeds will go to finance the £20m costs of the restructuring programme.
The cuts come in a difficult time for pottery companies. Churchill China is cutting 150 jobs, while Ireland's Waterford Wedgwood is cutting 1,400 jobs. Waterford Wedgwood owns a 15 per cent stake in Royal Doulton.
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