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Rebranding & Closure Of DEKA Stores

Farmers Announces Rebranding And Closure Of DEKA Stores

Farmers Deka Limited Chief Executive, Nick Lowe today announced the closure of the Deka business.

Mr Lowe’s announcement followed the release of a statement to the Australian Stock Exchange by parent company, Foodland Associated Limited (FAL) that said:

“A strategic review of the long term viability of Deka has been prompted by both trading losses for the half of NZ$3.3 million and the prospect of a continuing deterioration in the performance of that business. The Group has decided to accelerate the exit from the Deka brand and has fully provided for this outcome by creating provisions of A$20.7 million…”

The Deka brand will cease to exist and the company intends to rebrand 17 stores as Farmers. The remaining 43 stores and Auckland-based distribution centre will close in due course. The rebranding process will begin shortly and should be complete by 31 July. The majority of store closures will also occur in July. Mr Lowe expressed his regret at the job losses.

“This decision has not been made lightly and we are acutely aware of the impact this will have on our team members. However, our attempts to turn Deka into a profitable business have been unsuccessful and we are no longer prepared to sustain continued trading losses,” he said.

As a result of the Deka closure, 468 full time and 947 part time employees will eventually be made redundant. However, between newly created roles in the 17 rebranded stores and other positions currently available within Farmers, the company has almost 400 vacancies to be filled.

“Our overriding concern during this time is for the well being of our team members. We are doing all we can to mitigate the impact of the closure including actively recruiting Deka personnel for vacancies within Farmers and our sister company, Progressive Enterprises. We are also offering financial planning assistance and counselling, “ Mr Lowe said.

Mr Lowe also detailed expansion plans for the Farmers brand.

“Our intention is to aggressively expand Farmers’ operations. By July 2003, our retail square footage will increase by at least 30 per cent. This significant growth will be achieved through the opening of four new stores, the enlargement or relocation of three stores and the planned rebranding of the 17 Deka stores.

“Initiatives such as these will see more than 1000 new jobs created within the next three years,” Mr Lowe said.


[ends]


* Store lists attached
Appendix 1


DEKA STORE CLOSURES

NORTHLAND (3)
Dargaville, Kaikohe, Whangarei

AUCKLAND (8)
Downtown (Queen St), Karangahape Rd, Manukau, Onehunga, Otahuhu, Pakuranga, Papakura, Pukekohe

WAIKATO (6)
Hamilton, Huntly, Morrinsville, Taupo, Te Awamutu, Te Kuiti

TARANAKI (3)
Hawera, New Plymouth, Stratford

KING COUNTRY-WANGANUI (2)
Taumaranui, Wanganui

BAY OF PLENTY (1)
Tauranga

HAWKES BAY (3)
Napier, Waipukurau, Wairoa

WAIRARAPA - WELLINGTION (7)
Coastlands (Paraparaumu), Cuba St (Wellington), Fielding, Lambton Quay (Wellington),
Lower Hutt, Masterton, Wainuiomata

MARLBOROUGH (2)
Blenheim, Richmond

CANTERBURY (3)
Bush Inn, Eastgate, New Brighton

OTAGO (3)
Balclutha, Dunedin, Oamaru

SOUTHLAND (2)
Gore, Invercargill

Appendix 2


DEKA STORES TO BE REBRANDED AS FARMERS

AUCKLAND (3)
New Lynn, Westgate, Whangaparoa

WAIKATO (3)
Chartwell (Hamilton), Matamata, Tokoroa

BAY OF PLENTY (2)
Rotorua, Whakatane

GISBORNE (1)
Gisborne

MANAWATU (1)
Palmerston North

HAWKES BAY (1)
Hastings

WELLINGTON (1)
Kilbirnie

NELSON (1)
Nelson

WEST COAST (1)
Greymouth

CANTERBURY (3)
Hornby, Riccarton, Timaru


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