Steel company restructuring puts more emphasis on South Yorkshire
A four-point restructuring plan proposed by Liberty Steel UK puts greater emphasis on South Yorkshire, but could cost 440 jobs elsewhere in the country.
The company proposes to focus more on high value alloy steel production at Speciality Steels in Rotherham, Stocksbridge, and Brinsworth, as well as importing semi-finished products to feed rolling mills at Rotherham, Scunthorpe, and Dalzell in Scotland. This latter move will mean a reduction in primary production at Rotherham, but could mean the plant there will ultimately become a green steel facility producing up to 2m tonnes a year.
Meanwhile, operations at Newport in Wales and West Bromwhich in the Midlands are to be idled as part of the package of measures aimed at creating an entity more able to withstand challenging market conditions, serve strategic supply chains, and provide the foundation for a decarbonised UK steel industry.
Despite the injection of £200m of shareholder capital over the last two years, the production of some commodity grade products at Rotherham and downstream mills has become unviable in the short term due to high energy costs and imports from countries without the same environmental standards. Primary production through Rotherham’s lower carbon electric arc furnaces (EAFs) will be temporarily reduced while uncompetitive operating conditions prevail.
The company says its plans will forge a viable way forward for the business, provide a safety net to affected employees and help safeguard jobs in its wider workforce of 1,900 permanent employees, and up to 5,000 including contractors.
Jeffrey Kabel, Chief Transformation Officer for LIBERTY Steel Group said: “Refocusing our operations will set the right platform for LIBERTY Steel UK’s high-quality manufacturing businesses to adapt quickly to challenging market realities. The support of our marquee customers will enable us to produce high value, differentiated products through 2023 and beyond for strategic sectors such as aerospace, defence and energy. We remain committed to our longer-term growth plans in the UK including our plan to grow Rotherham into a 2 million tonne green steel hub.
“While our action is expected to regrettably impact the roles of some of our workforce we will provide a level of guaranteed salary and out placement opportunities through our unique Workforce Solutions programme as an alternative to redundancy. LIBERTY’s shareholder Sanjeev Gupta has supported the business through a very difficult period and remains committed to the workforce here in the UK and ensuring our lower carbon operations help deliver a sustainable, decarbonised UK steel industry.”
Meanwhile, Director General of UK Steel Gareth Stace said: “The restructuring announcement from Liberty Steel highlights the significant challenges UK steel companies face navigating the current harsh market conditions. There will naturally be concern regarding the 440 jobs potentially impacted, but this is unfortunately an ongoing risk that accompanies a persistently uncompetitive business environment here in the UK, further exacerbated by global supply chain difficulties.
“High energy prices have played an important role in the decisions announced today, with long-standing uncompetitive electricity prices having constrained UK investment and steel production for some time. This highlights again the need for government to fully address the UK’s structurally high industrial energy prices, looking beyond the important announcements made regarding the Energy Bills Discount Scheme earlier this week. It is crucial we also now see the development of a long-term decarbonisation plan for the sector, ultimately ensuring that the UK can be seen as an attractive place to invest in steel production.”
Government’s change in energy support rules leaves some farming sectors out in the cold, says NFU
She said the NFU had repeatedly made the case that energy prices were threatening next year’s crop of tomatoes, cucumbers and peppers, pointing out how the changes to support seemed to at odds with the government’s ambitions to grow more fruit and vegetables, according to its National Food Strategy.
“While we accept that farming businesses can’t be insulated from long term market realities, the government must recognise that its current approach seriously undermines our ability to produce food,” Minette said. “We are asking for a review of the scheme so that if and when energy prices do rise, there can be changes made to support essential food producing sectors.”
Sunny Bank Mills hits major milestone
Sunny Bank Mills, the historic mill complex at Farsley between Leeds and Bradford, is celebrating a very special century.
The arrival of two new occupiers at the iconic textile mill means that there are now 100 companies on site.
Fusion By Design Ltd and ATB Group UK Ltd have taken quality office space at Sandsgate and the 1912 Mill respectively.
During the past ten years Sunny Bank Mills, one of the most famous family-owned mills in Yorkshire, has been transformed into a modern office and mixed-use retail and leisure complex for the 21st century, creating more than 400 sustainable new jobs.
John Gaunt, the joint Managing Director of Edwin Woodhouse Ltd, the mill’s parent company, said: “This is a very special landmark for us – a real cause for celebration. When we first started redeveloping the mill in 2012, there were fewer than 10 companies on site. Now there are more than ten times that number.
“It was over 100 years ago that a journalist in the Leeds Mercury wrote that when Sunny Bank Mills thrives, Farsley thrives. We believe that this is as true now as it was then.”
William Gaunt, who runs the mill with his cousin John, added: “We are delighted to welcome these two exceptional companies to Sunny Bank. Both have clients across the globe and have established superb reputations over the years. We are proud they have chosen our mill as their Yorkshire base.”
Paula Jepmond of Fusion By Design, an interior design company, explained why the company had chosen Sunny Bank.
“The 2,000 sq ft unit we have taken is absolutely perfect for our requirements and the local facilities just add to the attraction. We love the location and vibrancy of Farsley and believe Sunny Bank Mills to be the heart of the village.
“We are local so were always aware of the mill but the investment the Gaunt family has made is fantastic, giving this historic mill a new lease of life.
“We specialize in interior design for the commercial and hospitality sectors and have just celebrated our 24th Birthday. We are a team of seven working all over the UK and have completed projects as far afield as Hong Kong and China.
“We are currently working on a project in Berlin and are looking forward to working with the same client throughout Europe over the next few years. We have always been based locally, originally starting in Bramley, then Rodley, Calverley and now Farsley. Being Leeds-based, we are perfectly located for working all over the UK.”
Meanwhile Colin Zhang of ATB Morley, who have relocated from Stanningley, said: “The 1912 Mill is the landmark building of Sunny Bank Mills, with well-developed facilities and ample parking spaces. The glorious mill was founded in 1829 and has been redeveloped into a gorgeous complex; it’s the perfect place for ATB Morley, founded in 1897, to open our new chapter.”
Colin explained that ATB Morley was one of the divisions of ATB Group UK Limited, Wolong Electric, which specializes in the design and manufacture of heavy-duty motors for use in underground mining under harsh operating conditions.
The company is recognized globally as pioneers in performance, winning the Queen’s Award for Enterprise for International Trade in 2009 and 2012 and the Queen’s Award for Innovation in 2010.
Shadow Chancellor Rachel Reeves, who visited Sunny Bank Mills in December, praised the mill for being a catalyst for the regeneration of Farsley, commenting: “It’s been so inspirational meeting small business owners. The range of small businesses here is fantastic and I’ve only managed to speak to a few. I have been especially impressed by the way in which the owners of Sunny Bank adapt their buildings to enable their tenants to grow.
“Small business owners working with like-minded people will find synergies and inspiration here, which is beautiful. This is an old mill which has brought people together and been the catalyst for more small businesses opening on the rest of Farsley Town Street. It is inspirational what has been achieved so far.”
One of England’s highest dispensing bricks and mortar pharmacies sold in group deal
Stagedale Limited, the operator of two high-dispensing volume pharmacies in Lincolnshire, has been sold.
The sale comprised West Elloe Pharmacy, which sits adjacent to a busy health centre in Spalding, and Knight Street Pharmacy, which occupies a prominent high street location in Pinchbeck. On average, West Elloe Pharmacy dispenses a huge 53,000 items per month – making it one of England’s highest dispensing bricks and mortar pharmacies – and Knight Street Pharmacy dispenses over 9,000 items per month.
Innovation and technology have been core principles of the business, as they have adapted over the years to implement automated dispensing services and to allow patients to collect prescriptions 24 hours a day – a service that has developed strongly as a result of the pandemic.
Stagedale Limited, which owned and operated these pharmacies for over a quarter of a century, was put up for sale following the impending retirement of some of its shareholders.
Through a confidential sales process managed by Carl Steer and Tony Evans at Christie & Co, it has been sold to BMP Healthcare Limited, a Leicester-based, eight-strong pharmacy group.
Ryszard Cygan, Managing Director of Stagedale Limited, says: “We are delighted to have sold the business to BMP Healthcare, a young and exciting group which shares the same ethos and principles we have had at the core of our business for the last 25 years. We are confident that Rahul and team will continue to develop the services the pharmacies offer, further enhancing their profile with patients across the Spalding area.”
Rahul Patel, Managing Director of BMP Healthcare Limited, says: “We are delighted to have acquired such a prestigious pharmacy business which has been at the heart of community pharmacy in the Spalding area for over a quarter of a century. Working alongside our existing eight pharmacies, we are looking forward to delivering not only the strong service the pharmacies already offer but also to introducing additional services to further enhance the delivery of care to our patients.”
Carl Steer, director – Medical at Christie & Co, says: “The sale of Stagedale Limited demonstrates the appetite and confidence some operators have in the marketplace. Knowing Rahul’s existing pharmacy estate, the purchase of Stagedale Limited’s pharmacies will complement this further to the benefit of patients and the communities the pharmacies serve.”
Stagedale Limited operating West Elloe Pharmacy and Knight Street Pharmacy was sold for an undisclosed price.
Fashion retailer to invest £2m in Leeds warehouse upgrade
Fashion retailer Joe Browns plans to spend £2m in a warehouse upgrade designed to support both its growth ambitions and increase pick face efficiency even further.
Its existing warehouse, part of its head office building in Holbeck, Leeds, was extended in November 2020 at a cost of £1.5m. The further upgrade is because of continuing healthy sales growth and helping to futureproof the logistics element of the business.
Work starts on the warehouse upgrade, which handles the retailer’s home and fashion offer, in three weeks and will see it functional by Q3. The existing operation within will function throughout the works.
Darren Abbott, the company’s Finance Director, said: “We’ve already outgrown our earlier warehouse extension and this investment will ensure an even more efficient scan and pick capacity as we continue to grow.”
Reed Boardall sets sights on period of growth after tough year
Yorkshire-based temperature-controlled food storage and distribution business Reed Boardall has battled through one of the most difficult years in its 30 year history as the industry reeled from Covid lockdowns with staff self-isolating while also facing the challenges of rising labour, fuel and energy costs, as well as the UK-wide HGV driver shortage.
Despite having also had a number of additional adverse factors with which to contend, the business says it is now moving forward from a position of strength and planning for continued growth.
In the year to March 2022, turnover grew by 6.2% compared with the previous year, rising from £69.8m to £74.1m. However, in the face of extremely difficult trading conditions, the company sustained a £4.1m loss before tax. This compares with £705,000 profit in the year ending March 2021.
Marcus Boardall, Chief Executive of Reed Boardall, said: “There’s no question that it has again been a very difficult year for the industry. We have seen the challenges of rising employment costs and inflation forcing up prices for most operators, while coping with continued disruption as a result of reduced staff levels due to Covid, along with the problem of driver shortages.
“Looking to the future, the pandemic disruption appears to be settling, and we are starting to bear the fruits of the proactive initiatives we have undertaken to establish our own in-house team of drivers – for example, over the last year, we have trained over 20 new recruits from scratch at our own academy, enabling them to become qualified drivers.”
He continues: “Our financial performance was also adversely affected by Reed Boardall being the victim of a criminal cyber-attack, resulting in our IT systems being out of operation for six days. The costs associated with the interruption, loss of revenue and subsequent recovery, were substantial. The situation was exacerbated by bad debt as one of our largest transport customers was placed into administration, although the contract has been taken over by a major retailer.
“Despite all of these factors, we saw store utilisaton and turnover increase, and are confident that better times are ahead. We have established a strong position in the marketplace and we will continue to prove the success of our single site strategy where we are able to serve all our customers’ needs efficiently. I would like to thank our 800-strong team and loyal customers for their continued support as we continue on our growth journey.”
Finance director Sarah Roberts adds: “Given the myriad of pressures on the business over the last 12 months, we have once again put in a resilient performance and are pleased to say that we are now on a much more even keel. Having completed the multi-million pound expansion of one of our cold stores in spring 2021, we have the largest and most modern facility of its kind in the UK. With a capacity of 168,000 pallets, we have continued to see volumes rise since the year end.
“We have also secured additional business in the new financial year and our ability to adapt to an ever-changing industry is enabling us to attract new customers with very specific requirements while still ensuring their integration into our operations complements our existing customer base.”
Major letting line-up for Sheffield warehouse development
Aver, a joint venture between NFU Mutual and Ergo Real Estate, has let 87 per cent of the floor area at Ergo Park in Sheffield to an impressive line-up of tenants, including Argos/Sainsburys, Tesla and the world’s largest package delivery company. The development, which reached Practical Completion at the end of October 2022, spans 11 acres totalling 191,500 sq ft of prime industrial logistics space. Prominently located, Ergo Park is adjacent to the Drakehouse and Crystal Peaks Retail Parks at Waterthorpe in Sheffield. The scheme has been delivered by Total Developments.Ergo Park is the latest in a number of prime warehouse developments by Aver, taking the company’s total portfolio to over 1.1 million sq ft.Leigh Burnett, asset manager, Ergo Real Estate, said: “Our JV with NFU Mutual has resulted in the delivery of ‘best in class’ in the logistics sector, which is evident in the high calibre of tenants we have attracted to Ergo Park prior to Practical Completion.”Rebecca Schofield, head of the Yorkshire industrial team at Knight Frank in Sheffield, which acted with M1 Agency to let the units, said: “This is an impressive take up with three units taken and one left demonstrating the demand for this type of build and accommodation in the region.“Occupiers are drawn by the easy access to the motorway and Sheffield city centre but also the great local amenities and public transport links.”Just one unit of 25,387 sq ft remains.
Planning applications pave way for import of green energy from Scotland to Yorkshire
National Grid has submitted a full planning application to East Riding of Yorkshire Council for the laying of 67km of onshore underground cables, and a further application to Selby District Council for the laying of 2.5km onshore underground cables and for a converter station and associated infrastructure.
It’s all part of the Scotland-England ‘Green Link 2, being developed to National Grid, together with Scottish and Southern Electricity Networks, to transfer green energy from Scotland to England through off-shore cables which will be connected to converter and electricity substations onshore.
The 2GW high voltage electricity transmission link is planned to run from Peterhead in Aberdeenshire to Drax in Selby.
The NFU’s response to both East Riding of Yorkshire and Selby District Councils has raised a number of issues including:
- Consultation and engagement
- Voluntary agreements
- Cable depth
- Construction best practice including drainage and soils
- Construction timings and methodology
LIBERTY Steel UK to implement next phase of restructuring programme, impacting 440 roles
LIBERTY Steel UK (LSUK) is set to implement the next phase of its restructuring programme, “in the face of the UK steel industry’s severe competitiveness issues,” which could impact up to 440 roles across the business.
According to LIBERTY, the four point restructuring plan will “create an entity positioned to better withstand challenging market conditions, serve strategic supply chains and provide the foundation for a decarbonised UK steel industry.”
The four elements are:
- With the support of major customers, LSUK will focus on high value alloy steel production at Speciality Steel UK (SSUK) sites in Rotherham, Stocksbridge and Brinsworth serving strategic aerospace, energy and engineering supply chains. SSUK will ramp up high value production at specialist plants through the year with a view to breaking even in September, laying the ground for further upside potential. LSUK has halted the sale process for the Stocksbridge and Brinsworth plants.
- A reduction in primary production at Rotherham, replaced by imported billet and slabs to feed rolling and finishing lines at Rotherham, Scunthorpe, and Dalzell as an interim measure to mitigate the impact of uncompetitive energy costs.
- The idling of LIBERTY Steel Newport and downstream processing facilities, and LIBERTY Performance Steel West Bromwich, with the former transformed into a sales and distribution hub for LIBERTY products.
- A commitment to restart commodity production and idled plants when the market and operating conditions allow, and a longer-term aim of growing Rotherham into a 2 million tonnes per year green steel facility.
Card Factory appoints new CFO
Card Factory, the Wakefield-headquartered retailer of greeting cards, gifts, wrap and gift bags, has appointed Matthias Seeger as chief financial officer.
Matthias has been CFO of Ambassador Cruise Line Limited since February 2022, having previously been CFO of Costcutter Supermarkets Group from September 2015 to September 2021.
Previous roles throughout his 31 year career include senior finance roles with Procter & Gamble, in Germany, the UK, Belgium and Switzerland, between 1991 and 2013. Matthias has a Master’s Degree in Engineering and an MBA from the University of Texas.
Matthias is expected to join the company on 22 May 2023.
The company has now agreed that Kris Lee will leave the company on 31 January 2023, at which time he will step down from the company’s board.
Pending Matthias joining Card Factory, Simon Comer, currently group financial controller, will be appointed as interim chief financial officer, but will not be appointed as a director of the company. Simon has been group financial controller since June 2021, having held previous senior finance roles, including CFO roles, in private equity and listed companies.
Darcy Willson-Rymer, Chief Executive Officer, said: “I am delighted to announce that Matthias is joining Card Factory as our CFO. Matthias has extensive financial experience and I look forward to working with him again, confident that his expertise and values will support Card Factory’s strategic projects and significant change programme over the next few years.
“I am grateful to Kris for his tireless work over the years, including successful management of liquidity, steering the business through a series of refinancing through covid lockdowns and supporting our ‘Opening our new future’ growth strategy. We offer Kris our very best wishes for the future.”
