Canada Bread to shut down two bakery facilities in New Brunswick and Alberta

Canada Bread Company has announced plans to shut down two bakery facilities in Canada, as part of its strategy to reduce costs, a move which will lead to the loss of up to 121 jobs.

The closure of the bakeries is part of the company’s efforts to improve operating efficiencies in its network by reducing overheads, allowing rationalisation of lower margin products and shifting production to more efficient facilities.

Canada Bread will close two bakery sites in Grand Falls, New Brunswick and Edmonton, Alberta.

The Grand Falls bakery, which produces a wide range of cake products, sweet goods and English muffins, is scheduled to close on 28 June 2013, affecting 75 employees.

The production of English muffins at this plant will be consolidated at the company’s existing facilities, while the production of cake and sweet goods will be discontinued.

The closing of the Edmonton bakery on 30 March 2013 will affect 46 employees and the production will be consolidated at other bakery facilities.

Canada Bread president and chief executive officer Richard Lan said: "We must adapt to food inflation and rising costs by further lowering our cost structure and improving operating efficiencies."

The closure costs, which will be incurred in 2013, including severance, decommissioning and asset write-downs, are expected to be approximately C$6.3m ($6.29m).

The company noted that it will help the affected employees in their transition to new employment.

Canada Bread, which is 90% owned by Maple Leaf Foods, is a manufacturer and marketer of bakery products, frozen par-baked products and fresh pasta and sauces under the Dempster’s, Olafson’s, POM, Ben’s and Olivieri brands.

It posted C$1.6bn in sales in 2011 and has 6,000 employees across its operations in North America and the UK.

Maple Leaf Foods, based Toronto, Canada, is involved in the bakery, meals and meat segments with operations across Canada, the US, Europe and Asia.