Kresta to manufacture offshore
The company announced in August that it had begun streamlining its manufacturing operations and upgrading its infrastructure as part of a strategic review of the business.
As well as outsourcing its Venetian blind manufacturing to a “high quality manufacturer in Asia” the company was investing in automated manufacturing equipment at its Malaga WA site; relocating the Jandakot WA manufacturing operations to the Malaga headquarters; and consolidating curtain production to Curtain Wonderland’s Brisbane site.
Redundancies would also be a part of the restructure, with Kresta’s 1000-strong workforce to be reduced by 72, incurring redundancy costs of around $460,000. Meanwhile the sale of commercial real estate now surplus to requirements was likely to yield more than $5 million.
Chairman John Molloy said the changes were designed to reduce costs and improve product ranges. Despite the offshore move of its Venetians business, Kresta would “continue to be a substantial manufacturer in Australia, with production facilities in Perth, Brisbane and Melbourne,” he said.
With the changes expected to ensure the quality of Kresta products, “they also improve our ability to respond quickly to market trends, ensuring our customers have access to the best possible range of window furnishings available in the Australian market.”
The company’s July market update confirmed it was anticipating an unaudited loss after tax of around $780,000 for the 2011 financial year, attributed to softening retail sales and abnormal items arising from inventory write-downs in the preceding six months.
The business reported unaudited positive EBIT for 2011 of $2.3 million before abnormal items were accounted for.
released: Thursday, August 11, 2011
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