HKScan Oyj Stock Exchange Release Oct 1, 2015 8:30 AM

HKScan invests in growth with a new production facility in Rauma, Finland

Leading Nordic meat company HKScan is pursuing its strategy of profitable growth (as announced in stock exchange releases of 13 October 2014 and 5 August 2015). The Board of Directors has decided that Rauma will be the location of a new HKScan production facility specializing in poultry products. The investment is valued at approximately EUR 80 million, and the new facility is scheduled for completion approximately at the end of 2017. The project will rank among the most significant production-related investments in HKScan history so far.

Innovative Kariniemen products for home and export markets

The added capacity and optimized technology enabled by the investment will allow the Group to develop innovative Kariniemen product novelties for the home and export markets. Faster processes will mark a further improvement in product quality. “The investment will strengthen HKScan’s foothold on the rapidly expanding poultry market and in value-added product categories, which are our strategic focus segments,” says CEO Hannu Kottonen.

Investment boosts productivity and environmental efficiency

“Our productivity will improve significantly thanks to state-of-the-art technology, automation and greater overall process efficiency. At the same time, we will be able to utilize side-streams more efficiently for the production of biotech products. The investment will also generally improve our environmental efficiency,” adds Kottonen.
Complying with HKScan’s Corporate Responsibility Programme, the new facility will adopt solutions to promote occupational health and safety and to maximize material, energy and environmental efficiency. Biosecurity related to risks of animal diseases will also improve.

The investment will safeguard long-term employment opportunities in the meat industry in western Finland. It will have significant direct and indirect employment impact. After reviewing the alternatives, HKScan and its personnel have together agreed that the new facility will employ close to 300 meat experts when completed from the end of 2017 onwards. Related statutory negotiations were concluded last week in Eura. The headcount reduction will not exceed 239 person-work years.

Now that the location of the facility has been decided officially, HKScan will apply for the necessary permits without delay in the hope of gaining approval from the authorities as soon as possible. Preliminary permit surveys have already been made. When the Rauma facility is completed approximately at the end of 2017 it will replace HKScan’s current production unit in Eura. It will remain in operation until the new facility opens. The investment will result in a non-cash write-down of the current Eura facility’s assets amounting to about EUR 11 million.

HKScan Corporation
Hannu Kottonen
CEO

For further information:
Hannu Kottonen, CEO, HKScan Corporation
Kindly submit a call-back request to Marja-Leena Dahlskog, SVP Communications, HKScan Group, marja-leena.dahlskog(at)hkscan.com, tel. +358 10 570 2142.

A press conference on the investment will be held for the media in the Council Chambers of Rauma Town Hall (address: Kanalinranta 3, 26100 Rauma, Finland) today, Thursday, at 1:00 pm. We kindly request a notification in beforehand to Marja Siltala, VP Communications, HKScan Group: marja.siltala(at)hkscan.com (tel. +358 10 570 2290).

HKScan is the leading Nordic meat expert. We sell, market and produce high-quality, responsibly-produced pork, beef, poultry and lamb products, processed meats and convenience foods under strong brand names. Our customers are the retail, food service, industrial and export sectors, and our home markets comprise Finland, Sweden, Denmark and the Baltics. We export to close to 50 countries. HKScan’s net sales in 2014 totalled about EUR 2.0 billion and we have some 7 700 employees.


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