HelloFresh has announced potential plans that could lead to the closure of a key º£½ÇÊÓƵ facility, endangering 900 jobs in the process.
The company has indicated that should the proposals receive approval, its distribution centre in Nuneaton is slated to remain operational until mid-2025, as reported by .
Inaugurated two years ago, the 237,000-square-foot site was HelloFresh's second when it commenced operations in 2020.
This development follows reports from City AM highlighting that the British division of HelloFresh has substantially reduced its pre-tax losses, nearing a turnover of approximately £500 million in the last financial year.
Nonetheless, there has been a reported reduction in the average º£½ÇÊÓƵ workforce for the company, declining from 2,159 to 1,842 employees over the past year.
The previous time HelloFresh reported a pre-tax profit in the º£½ÇÊÓƵ was in 2020 with £8 million; subsequently, the company has faced nearly £50 million in losses.
Notwithstanding the proposed site closure, HelloFresh has insisted that this does not reflect on the performance of its team.
The statement from HelloFresh read: "We have made the difficult decision to propose the closure of our distribution centre in Nuneaton, subject to consultation."
Further explaining the rationale, the firm added: "After reviewing all of our options, we have decided that consolidating our operations and leveraging more of the technologically advanced parts of our network will enable us to offer the best product to our customers while reducing emissions and waste."
Hellofresh also expressed its commitment to its workforce during these challenging times: "We know how unsettling this can be for our employees, who we are supporting throughout the consultation process."
"If the proposal is accepted, we will prioritise redeployment opportunities within the business, and look to offer incentives to employees who stay with us until the site eventually closes."
was the statement from the company regarding potential site closure.
The firm also noted: "The proposal is for the site to remain operational until at least mid-2025, so everyone has been notified significantly earlier than their contractual notice periods."
Further adding, "The planned closure of the site is no reflection on the performance of the local team, and we are grateful for their hard work and commitment."
In a positive turn for the business, HelloFresh experienced a surge in sales during the third quarter.
As part of the update, it was revealed that the Berlin-headquartered wider HelloFresh group reported revenues of €1.83bn (£1.52bn) for its third quarter, marking an increase from the €1.80bn recorded in the same period last year.
Dominik Richter, co-founder and CEO, commented on the strategy moving forward: "In meal kits, our focus for the next couple of quarters will be on improving further on an already excellent proposition to our customers, through more meal choice, better value for money and higher service levels."
He also outlined the company's financial ambitions: "We also aim to meaningfully expand free cash flows and profitability for the group, and have taken first decisive steps, such as being more selective in attracting new customers to our meal kit brands and adjusting our production footprint. We see these steps starting to reflect in the numbers."
Richter highlighted the company's growth prospects by stating, "The biggest growth driver for the group over the next three years, for both revenues and profits, will be our RTE product category."
"Today, we are already the RTE market leader in the US and have developed the product, technology and food manufacturing capabilities to reach many more people around the world with our RTE products."
