French processor in voluntary administration cuts jobs
commencing voluntary administration proceedings in late July, French poultry
processor Tilly Sabco has announced that it will cut 125 of its 450
According to the company, the requirement to commence voluntary
administration came as a result of the serious impact of the consequences of the
avian flu crisis, which brought about the closure of its main export markets and
ongoing restrictions after France was declared bird flu free.
The company hopes that the administration procedure will give the economic
environment the opportunity to take initiatives to contribute to the development
of various scenarios for the continuation in whole or part of Tilly Sabco's business activities and employment, subject
to the control of the Commercial Court.
Since February 2006, the management of Tilly Sabco has taken steps to adjust
to the situation by significantly reducing its production programme to avoid the
over exposure of its business, in the light of its financial commitments.
After several months of very poor business results (60% reduction in volume
and 55% reduction in turnover for the first half year) the company suffered
heavy losses. At present, market consumption has not recovered to the pre bird
flu level, exacerbated by a significant reduction in world prices.
Since the 18 June, the date on which France was officially cleared ofavian
flu, embargoes have been lifted slowly, with restrictions still in place.
Tilly Sabco is therefore left with 4,500 tons of stock for the export market
depreciating in value.
In such circumstances, and despite having considered alternative solutions,
Tilly Sabco has not been able to find an answer to the problem that would have
enabled it to avoid administration proceedings.
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