Home / Knowledge / News / Textiles / Cavalier Corporation to shut down NEC Spinning Plant

Cavalier Corporation to shut down NEC Spinning Plant

28
Jun '12
Cavalier Corporation has advised staff at the yarn spinning plant of its subsidiary company Norman Ellison Carpets (NEC) that the plant is closing down on 26 July.  Staff affected by the closure were given the news at site meetings this morning. 

This decision was not taken lightly and came after a very thorough review process involving all of the Group's three woollen yarn spinning plants.

In April, Cavalier Corporation signalled that its earnings for the current financial year would be affected by one-off restructuring costs as it repositioned the broadloom carpet business to cope with the difficult operating environment. While the Company indicated at the time that the impact of the restructuring was difficult to project because of uncertainties as to timing, it still believes that if the estimated cost of all contemplated initiatives was taken into the current year, it would have the effect of reducing underlying earnings of between $3-5 million after tax to a loss of $1-3 million after tax.

The closure of the NEC spinning plant will result in a significant reduction in operating costs for the broadloom carpet business and is an integral part of the comprehensive business improvement program aimed at delivering $10-12 million profit after tax in the 2012-13 year.

Eight staff from the yarn spinning plant will transfer into NEC's tufting plant and it is hoped that at least a dozen of the NEC spinning staff will relocate to other plants within the Group, limiting redundancies to around 70 staff.  Some staff will be retained to de-commission and reinstall some of the existing NEC equipment at the Group's other plants.  All staff will be given every assistance to find other employment including job support outplacement and retraining allowances.

Staff have been advised of their redundancy entitlements and the plant will stop making yarn before the end of July.

The Board stressed that the NEC carpet business and the Norman Ellison Carpets brand itself would not be affected by the move.

This decision is about reducing over-capacity in the yarn spinning operations that support the Group's broadloom carpet manufacturing operations.  NEC will continue to make carpet at its Onehunga tufting plant, supported by very capable manufacturing and sales teams.

Cavalier Corporation


Must ReadView All

Pic: Shutterstock

Textiles | On 5th Aug 2021

US manufacturing activity grows in Jul; textile mills report fall: ISM

Economic activity in the US manufacturing sector grew in July, with...

Pic: Shutterstock

Textiles | On 5th Aug 2021

UK inflation to hit 3.9% in early 2022, 2% in 2023, predicts NIESR

UK consumer price inflation will reach 3.9 per cent early next year,...

Pic: Shutterstock

Apparel/Garments | On 5th Aug 2021

Prime Content| Why China's share in global apparel exports will drop this year?

China's share in the global apparel exports market went down from...

Interviews View All

Textile Industry, Head honchos

Textile Industry
Head honchos

Main challenges are breakdown of supply chain and shrinkage of manpower

Florian Heubrandner, Lenzing AG

Florian Heubrandner
Lenzing AG

Sustainable and eco-friendly fibres remain in the minority

Textile Industry, Head honchos

Textile Industry
Head honchos

Money never disappears-it just finds new opportunities

Gus Bartholomew,

Gus Bartholomew

<b>Gus Bartholomew</b>, co-founder of SupplyCompass, explains to <b>Subir...

Kriti Kanodia,

Kriti Kanodia

A TV show in 2012 where actor Sonam Kapoor customises her own pair of...

Ritu Oberoi,

Ritu Oberoi

Established in 2018, Forsarees is a socially driven business enterprise,...

Brad Holschuh, Wearable Technology Lab, University of Minnesota

Brad Holschuh
Wearable Technology Lab, University of Minnesota

A new study led by researchers at the University of Minnesota's Design of...

Thomas Ong P S, NanoTextile

Thomas Ong P S
NanoTextile

Malaysian company NanoTextile Sdn Bhd taps into the potentials of...

Sameer Sonkusale & Rachel Owyeung, Tufts University

Sameer Sonkusale & Rachel Owyeung
Tufts University

A team at the Tufts University in Massachusetts was recently in news for...

Sweta Agarwal, A Humming Way

Sweta Agarwal
A Humming Way

A Humming Way (AHW) is inspired by the old-world regalia of Rajasthan...

Sailesh Singhania, Sailesh Singhania Label

Sailesh Singhania
Sailesh Singhania Label

The Sailesh Singhania label was created to promote handwoven sarees and...

Shalini Sharma & Shweta Pundir Sharma, Six Yard Story

Shalini Sharma & Shweta Pundir Sharma
Six Yard Story

Six Yard Story is a premium artisanal brand with a focus to bring handloom ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


July 2021

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Advanced Search