Statement re Consolidation of Production

Statement re Consolidation of Production

C&C Group PLC

C&C Group to consolidate production and invest over €10 million into expanding Clonmel manufacturing site

Production to transfer from Borrisoleigh and Shepton Mallet to Clonmel

Dublin, London | 12 January, 2016: C&C Group plc (“C&C” or the “Group”) announces that following a detailed review of its manufacturing and operational footprint, it intends to consolidate production from sites in Shepton Mallet (England) and Borrisoleigh (Ireland) into its manufacturing site in Clonmel, Tipperary.

Under the proposal, production and packaging will be transferred on a phased basis from the facilities in Shepton Mallet and Borrisoleigh. Consequently, Clonmel will become the core manufacturing site for both Bulmers and Magners cider, Tipperary Water and our range of niche premium beers and ciders. The Wellpark Brewery in Glasgow is unaffected by the proposal. In support of the proposal, the Group will invest in excess of €10 million in enhancing packaging and logistics capability in Clonmel creating 80 additional roles.

The trading environment in the UK and Ireland has been intensely competitive over recent years. This has led to significant downward pricing pressure and the loss of material contracts for private label water. Current capacity utilisation across the three impacted sites is 34% constraining C&C’s ability to compete over the longer term. Under the planned configuration, Clonmel will move to a capacity utilisation level of 75%.

The fruit milling operation at Shepton Mallet is not impacted by the proposal and C&C will continue to source apples on a long-term basis from local farmers. Equally, Borrisoleigh will remain as a key transport hub and both logistics and warehousing operations will be maintained in the town.

Regrettably, net roles lost across the operational network is estimated at 180 of which 127 are in the UK and 54 in Ireland. This has been a difficult decision for the Group and it is sad that the consolidation of production at the Clonmel site is the only viable option to maintain long term competitiveness. C&C recognises the impact on employees and will work to provide support, training, and where possible, alternative employment.

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FTI Consulting
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