Communisis announces restructuring plans

The company said that cheque production at the group’s Trafford Wharf site in Manchester will cease by the end of 2013, subject to consultation, and production will move to the Communisis site in Leeds.

Meanwhile, the Leeds site will be reconfigured with “a substantial amount” of the remaining, more commoditised direct-mail print being outsourced and managed instead through the third party supply chain.

The more specialist, higher margin direct mail and other production will remain in Leeds, Communisis added.

It said that the changes will provide the capacity needed to accommodate the cheque production transferred from Trafford Wharf and the printing of other transactional communications, acting as a supplementary facility for the group’s operations in Liverpool.

The group said that indirect overhead costs will be further reduced as processes and support services are streamlined to improve efficiency.

Andy Blundell, chief executive of Communisis said: “These plans are aligned with the group’s strategy to reduce its exposure to the more commoditised sector of the print market by focusing on higher margin specialist production and to improve margins by reducing costs and improving capacity utilisation.”

These changes are expected to yield annual cost savings of approximately £4m from 2014 and give rise to a net exceptional charge of £3.5m in 2013, with a cash cost of £2.8m in the second half of 2013 and £700,000 in the first half of 2014, said Communisis.

The company, which is now headquartered in London, still has its registered office in Leeds. It employs around 400 people at its direct mail facility in Cross Gates, Leeds.