Bremworth offers staff from cyclone damaged Napier factory voluntary redundancy, redeployment

Carpet maker Bremworth is offering staff at its cyclone-damaged Napier factory the option of voluntary redundancy or redeployment to its Whanganui plant.

Bremworth’s yarn spinning plant in Napier’s Awatoto industrial precinct has not operated since it was damaged by flooding from Cyclone Gabrielle in February, and the company has had to source dyed fibre and yarn from New Zealand and finished yarn from overseas suppliers for its Whanganui and Papatoetoe plants.

Its contracts specify all suppliers must use New Zealand wool.

Bremworth chief executive Greg Smith said a detailed assessment of the damage to the Napier plant and buildings has been completed, but the company does not yet have a definitive view around the future of the plant.

“It is possible the factory could be closed and we do not have any indication on how long the decision process could take,” he said. “As we work through a complex insurance process with our assessors, we hope to have a decision within the next few months.”

He said the Napier plant’s 147 staff had continued to be paid from insurance proceeds since the plant went offline in February, and had helped with the cleanup.

“The company is aware that team members are looking for more clarity around their future at the Napier plant,” he said.

“In response to staff feedback, Bremworth is presenting several options to team members that may assist with their personal circumstances and wellbeing – specifically, voluntary redundancy or expressions of interest for redeployment to Bremworth’s Whanganui plant.”

Smith said staff could take voluntary redundancy while the Napier plant was offline and look to rejoin the Bremworth workforce at a future date.

Napier staff could choose to stay at the Napier facility and would continue to be paid while the process was underway, he said.

Career and financial advice, as well as emotional support, was available to all employees, he said.

Bremworth employs a total of 430 staff.

In late June, the company said it received partial insurance settlements of $35.5 million. It expects further insurance payments upon completion of the assessment of damage to buildings, plant and equipment, and the loss of inventory and profit due to the interruption to the business from the cyclone.

Smith said the alternative supply arrangements for dyed fibre and yarns were proving successful, putting the company into an encouraging position to continue to supply key product ranges to its distribution partners.

He said the new hybrid supply chain model was complementary to Bremworth’s existing operations and would insulate the company from future events that could potentially disrupt operations.

Shares in Bremworth were unchanged at 42 cents in mid-afternoon trading on the NZX on Tuesday.