Post Foods considers closing US manufacturing facility

Post Holdings, the parent company of Post Foods and a manufacturer of ready-to-eat cereals, is considering closing its manufacturing facility in Modesto, California, a move which could put nearly 140 jobs at risk.

The company noted that the proposed plan would improve its operational efficiency, and better position it for future growth.

If the shutdown goes ahead, the company is expected to move production to other manufacturing facilities within its existing network.

Post Holdings president and chief operating officer Terence Block said that the company is committed to addressing its excess capacity.

"This initiative, if we proceed, would provide the increased efficiency necessary to compete in today’s environment," Block said.

The company will solicit input from the union that represents the hourly employees in order to ensure that their interests are represented before it makes a final decision on the proposal, which is expected by the end of April 2013.

Post said that it is committed to helping its employees through the transition, if it proceeds to close the Modesto plant.

Currently, the company’s products are manufactured at four facilities in Battle Creek, Michigan; Jonesboro, Arkansas; Modesto, California; and Niagara Falls, Ontario.

Its brand portfolio comprises Honey Bunches of Oats, Pebbles, Great Grains, Post Shredded Wheat, Post Raisin Bran, Grape-Nuts and Honeycomb.

Post distributes its products to supermarket chains, wholesalers, supercentres, club stores, mass merchandisers, distributors, convenience stores and the foodservice channel in North America.

In February 2013, Post reported that its fiscal first-quarter earnings dropped 41% as spinoff costs masked the company’s sales increase.

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Image: Post expects the closure of the Modesto facility to improve its operational efficiency and better position the company for future growth. Photo courtesy of PRNewsFoto/Post Holdings, Inc.