INDEPENDENT NEWS

Juken signals job losses from multi-million upgrade of Mill

Published: Tue 11 Sep 2018 01:17 PM
Juken New Zealand has started talking to staff over likely job losses as it plans to spend millions of dollars upgrading its Triboard mill in Kaitaia.
The local unit of Japan's WoodOne Ltd plans to upgrade the 30-year old mill to return it to profit and address safety concerns in a "multi-million dollar investment", it said in a statement. The upgrade will see parts of the mill shut and a new operating structure introduced to "streamline production". The company will meet its 250 Northland staff today to talk to them about the proposal in a two-week consultation period before final decisions are made on the future structure.
"This investment will result in a modern, safer and more efficient mill which can continue to be one of Kaitaia’s largest employers well into the future," Juken NZ general manager Dave Hilliard said. "We are being upfront though that the steps required to be taken to address the mill’s issues are unfortunately likely to result in some job losses."
The likely downsizing follows similar moves at Juken's wood-processing operations in Gisborne earlier this year, when it halved the workforce at the Matawhero site to 100, halting plywood and laminated veneer lumber at the mill and scaling back and SLVL (veneer) production. Those efforts were also an attempt to return to profit.
Juken NZ reported a loss of $31.7 million in the year ended March 31, compared to a profit of $31.1 million a year earlier. That included $75.6 million of impairment charges on plant, equipment and buildings, which were valued at just $47.6 million as at March 31, including $7.7 million of investment in the period. At an operating level, gross profit fell 10 percent to $38.4 million on a 0.5 percent increase in revenue to $221.6 million
Hilliard today said the Kaitaia mill's machinery and technology is old and created health and safety issues that needed addressing urgently. Constrained log supply compounded those issues, leaving the mill making a "substantial loss."
The company is in talks with the government about how to deal with the log shortage and Hilliard acknowledged Forestry Minister Shane Jones "who is actively working with us to help resolve the supply shortage and is a strong advocate for the forestry sector.”
BusinessDesk
Independent, Trustworthy New Zealand Business News
The Wellington-based BusinessDesk team provides a daily news feed for a serious business audience.
Contact BusinessDesk
Email:

Next in Business, Science, and Tech

Gordon Campbell on the Tax Working Group’s road map
By: Gordon Campbell
Media advisory re Australian strawberries
By: Countdown Supermarket
Broad-based growth as GDP rises 1 percent in June quarter
By: Statistics New Zealand
Judgment: NZ Steel v Minister of Consumer Affairs
By: New Zealand High Court
Tax Working Group proposes wider scope taxing capital gains
By: BusinessDesk
The Nation: Tax Working Group Chair Michael Cullen
By: The Nation
Tax Working Group publishes Interim Report
By: Tax Working Group
Feedback sought on Tax Working Group interim report
By: New Zealand Government
Govt won’t rule out tax grab on retirement savings
By: New Zealand National Party
Capital Gains Tax still hangs over NZ
By: New Zealand National Party
Robertson refuses to rule out higher taxes
By: New Zealand National Party
ACT Laments Over Tax Working Group Report
By: ACT New Zealand
Tax fixes not rocket science
By: New Zealand Council of Trade Unions
Report shows signs of extending the tax net
By: Public Service Association
View as: DESKTOP | MOBILEWe're in BETA! Send Feedback © Scoop Media