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Bread and Pasta Maker Announces Consolidation

Ljubljana, 24 November (STA) - Bread and pasta maker Zito announced a series of measures to consolidate its operations as it seeks to boost profit and revenues in a new strategy lasting through 2015.

The group said its goal was to increase revenues by two percent a year to EUR 121m by 2015. In this time it hopes to increase profit to EUR 8.8m from the current 3m.

As part of the planned consolidation measures, Zito intends to reduce the number of brands by a fifth.

"We will focus on brands in which we believe and which are respected," Zito Chairman Toni Balazic said. He indicated that special attention would be given to cereal products.

"We want to become one of the most successful Slovenian food companies with a strong foothold in the region."

Exports are to account for 20% of all revenues under the strategy. "The focus will be on SE Europe, especially Croatia, Bosnia-Herzegovina and Kosovo."

As part of efforts to increase sales in these markets, the group is not excluding takeovers.

Moreover, Zito intends to cut the number of production facilities in Slovenia from 16 to five by 2013.

This will be coupled with downsizing of the workforce, although that will be achieved without major layoffs, the chairman said.

As part of the consolidation of production facilities, the headquarters of the company will be moved from the building in eastern Ljubljana suburb and the building subsequently sold.

Zito's sales in the first nine months of 2010 amounted to EUR 80m, down 4% from the same period last year. Net profit was up 27% to EUR 900,000.

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