The news, which had been the subject of increasing industry speculation since Prinovis lost the DMG Media contract just over a year ago, was confirmed this afternoon (7 November).
Prinovis said the decline in the gravure market since 2019 had rendered the business unsustainable, despite support from parent company Bertelsmann and some new customer wins in recent months, including TV Choice for Bauer.
In a statement, Prinovis said management had undertaken a review of the business to consider all options, but there was no way forward.
“Over the past two years the company has implemented restructuring changes and initiated cost savings in an attempt to make the business viable.
“However, the continued market decline and the huge increases in raw material costs particularly energy have proven that the previous measures have been insufficient to avoid Prinovis UK operating at a financial loss.”
A consultation over job losses will now begin, which is likely to involve around 250 jobs going across all areas of the business.
The proposal for an orderly shutdown will see the factory cease operations on 30 June 2023.
Prinovis UK managing director Richard Gray was fulsome in his praise for the firm’s staff. He said: “This decision was a very difficult one for us and will of course be disappointing news for our fantastic workforce who in many cases have been with the business for many years.
“They have worked with the management team in difficult circumstances over the past two years to restructure, save cost and give the business the best chance to find a profitable future. Today’s proposal should in no way reflect on their dedication, commitment and performance over many years.”
He said the team had “built an enviable reputation for customer focus, flexibility and delivering great quality products on time”, and added: “I am sure we will all work hard to continue this level of professional performance in the coming months.”
The firm’s biggest customer currently is News UK. Printweek understands that the News UK supplements will move to Walstead Group, but neither this nor the timing has been officially confirmed as yet.
The greenfield gravure site set up by the then-Arvato business started up in 2006 and reached full production in 2008.
As gravure declined, Prinovis installed a 16pp Goss M600 web press with inkjet heads to augment its offering, and also reduced its operating hours after the loss of the Mail supplements, but it has proved economically unviable to completely reinvent the 65,000sqm site.
Prinovis UK has racked up operating losses of more than £12m in the last two financial years. In 2021 sales were down 13% to £46.1m, and the operating loss was nearly £6.5m.
By contrast, in 2010 the company had sales of £85.5m and filed a pre-tax profit of £17.5m.
The closure of the Prinovis site will leave Walstead as the “last man standing” in high-volume publication and catalogue printing, following the collapse of YM Group earlier this year.
A year ago Bertelsmann Printing Group also announced the closure of its Dresden gravure facility, reflecting the structural decline in the overall gravure market across Europe.
