We commented that restoring the group's fortunes would be neither quick, easy or cheap

Hamish Grossart

Royal Doulton has had financial problems for some time and earlier this month, it was in talks with its bankers after accumulating debts of more than �26m.

Over the past year the company has cut a number of jobs and some workers went down to a four-day week.

The annual figures show the company's sales have dropped by 4%.

The latest round of job cuts are part of a major restructuring plan which aims to raise almost �19m.

Chairman Hamish Grossart said: "At the end of 1998, when we commenced a radical restructuring of the group, which lost �39 million in that year, we commented that restoring the group's fortunes would be neither quick, easy or cheap.

Further measures

"Since the beginning of 1999, overheads have been cut by 16%, stocks by 40% and debt by 43% and employee numbers reduced by 30%.

"The further measures announced today are targeted to cut unit production costs by more than 20%, overheads by a further 30%, stocks by a further 25% and employee numbers will reduce by a further 20%."

The group's restructuring over the past three years has seen it close a number of retail units, cut jobs and sell brands such as Royal Crown Derby and Caitheness Glass.

Its latest plans are aimed at streamlining the firm to a "smaller but profitable business" based on its three global brands, Royal Doulton, Minton and Royal Albert.

Reduce expenses

It plans to reduce sales by �20 million over the next two years, reduce operating expenses and boost margins.

To fund the moves it aims to raise �18.9 million through a rights issue at 8p a share.

Shares in the group slumped 24% to 10.5p following the announcement, valuing it at just �8.7 million.

The troubled group also said operating losses for the year to 31 December came in at �12.4 million, against �14.7 million the previous year. Sales fell 6% to �166 million.

Royal Doulton employs 1,800 people in Staffordshire and almost 5,000 people worldwide.