A cider-maker has held its first annual meeting since announcing the closure of a village factory where production began more than 50 years ago.

The board of Merrydown confirmed the disposal of the historic site in Horam, near Heathfield, would cost the company about £2.5 million this year.

But the sale of the land, which will probably be used for housing, would wipe out any short-term losses and result in a net gain in the next financial year.

Merrydown bosses have decided to focus on managing rather than producing brands which include Shloer and various Merrydown ciders.

Production will move to a number of subcontractors while Merrydown's headquarters will relocate from Sussex to Reigate, Surrey.

Chief executive Nigel Freer yesterday described as sad the decision to close the factory - but was buoyant about improvement across the business as a whole.

He said: "I am pleased to report Shloer sales continue to grow strongly and we are poised for the main burst of summer promotional activity which this year will take place in the late summer.

"The new product programme is progressing well. The Posh Squash and Sorelle trials are encouraging and the new 275ml Shloer bottle is now in production. We are also planning the launch of another completely new drink in the autumn.

"Vintage sales have started the year in line with the same period last year. While the underlying rate of sale in supermarkets is growing, the wholesale sector overall continues to under-perform.

"While Christmas remains our most important trading period, we are encouraged by the group's trading and profitability in the year to date and we look forward to making further progress during the rest of the financial year."

The board also announced the retirement of director Robert Neame.

The factory at Horam shuts at the end of the year. The announcement was made shortly after the group recorded end-of-year profits of £1.76 million.

Sales of Shloer increased for the fifth year running and were up 30 per cent to £13.96 million while group sales rose 20 per cent to £20.3 million.

Friday July 30, 2004