A dairy company based in Wrexham with more than 300 staff has gone into administration.
PwC confirmed it had been appointed administrators after the company experienced “significant cash flow pressures.” It said all staff will be made redundant – except for a “small number who have been retained for a short period.”
Tomlinsons was established in 1983, when brothers Philip and John Tomlinson decided to diversify into liquid milk processing on their family farm in north Wales.
As well as its base in Wrexham which employs 273 staff, the dairy company has operations in Chester, Shropshire and across the North West.
In a statement, the administrators said, “Tomlinsons had suffered an accumulation of significant operating losses over recent years which were exacerbated by industry wide issues such as energy costs and a depressed cream price.
“The directors unfortunately had no alternative but to place the company into administration. Our thoughts are with the employees affected and we have ensured a range of support measures are available to them at this difficult time.”
The decision by Tomlinsons to cease milk collection comes after a £22 million funding boost in 2017 – £5m of which was directly from the Welsh Government, and a further £2m from Finance Wales – which saw an expansion of their cold storage facilities and the creation of 70 jobs.
The dairy recorded a profit of £45m every year in 2017 and had reported securing a contract with supermarket giant Sainsbury’s.
A spokesperson for Tomlinsons Dairies said the family shareholders, directors and management are “devastated” and “sincerely regret its impact on their customers, suppliers, farmers and employees.”
The Farmers Union Wales said the shock decision came in with almost immediate effect and has left many dairy producers in Wales “scrambling to find another processor for their milk.”
FUW Vice President Eifion Huws said: “We are extremely concerned for our members who are affected and who have contacted us. We had no prior warning and are extremely disappointed that farmers are left in a predicament where they have no one to collect their milk. Sadly we have lost yet another major processor in Wales, which comes as a severe blow to farmers, workers and the industry as a whole at a time when significant efforts are being made to bolster and build on our unique Welsh brand.”
A Welsh Government spokesperson said the news was “very disappointing.”
“We have worked closely with Tomlinsons Dairies during the past 18 months to try and help them resolve their ongoing business issues. We have now established a task force to work directly with the staff affected by the closure and are in discussions with Farming Unions and other stakeholders to consider what support is required at this difficult time.”
It added, “The Rural Development Programme Grant awarded to Tomlinsons Dairies Ltd was subject to a full and robust due diligence process.”