Oatly to Close Singapore Facility

Swedish beverage company Oatly has announced the closure of its Singapore plant in Senoko. The decision, as stated in a recent press release, aims to enhance the company's future cost structure and reduce capital expenditure needs.

Impact on Workforce

The closure will affect 34 staff members in Singapore, who will be phased out over the coming months. Oatly remains committed to supporting these employees, offering outplacement assistance and training to ensure they are treated with respect and care.

Company's Future Strategy

Oatly CEO Jean-Christophe Flatin highlighted significant improvements in the health of the company's greater China business. The closure is expected to capitalize on these improvements, ensuring efficient use of capital and costs while maintaining the right capacity when needed.

Financial Implications

The company anticipates non-cash impairment charges of about US$20 million to US$25 million in the fourth quarter of 2024. Restructuring and other exit costs will result in net cash outflows of US$25 million to US$30 million through 2027.

Asia-Pacific Growth Plan

With the closure of the Singapore facility, Oatly's growth in the Asia-Pacific segment will be supported by its existing facilities in Europe.