A PHARMACEUTICAL business preparing to welcome the Princess Royal to its County Durham plant, has announced plans to cut 300 jobs.

Durex-to-Scholl group SSL International plans to close its head office in Knutsford, Cheshire, and restructure its European operations.

About 150 jobs are likely to be lost in the UK, with the remainder in the rest of Europe.

A spokeswoman for the group said the UK job losses would be among its administration staff, and that no manufacturing positions would be affected by the plans.

It opens a plant on the White House Business Park, in Peterlee, on April 24. It employs about 250 staff at the site.

Earlier this year, the Peterlee plant benefited from a reorganisation of its Merseyside manufacturing operations, with additional production lines being transferred from Bootle to the North-East.

The spokeswoman said: "This announcement of job losses will not affect the new Peterlee plant, which is due to come on line in June.

"All the job losses will be at our head office and will only affect administrative positions. No manufacturing jobs will be lost as a result of this plan.

"However, SSL has embarked on a review of its manufacturing systems and operations, to be completed by the end of this year."

SSL said it had identified that "radical action" was necessary to reduce costs, improve margins and shareholder returns.

It said it had a high level of costs, particularly in Europe, which reflected "overmanning, duplication of activity and increased insurance costs".

The restructuring is expected to cost £18m this year, but will lead to cost savings of a similar amount.

The group manufactures condoms and surgical gloves in Malaysia and Thailand, and pharmaceuticals in the UK.

Its products include Durex condoms, Scholl footwear, Mister Baby baby products, Resolve hangover remedy and Full Marks headlice treatment. It also makes Marigold gloves and surgical gloves.

SSL said profits for the year to the end of March were expected to be in line with market estimates.

The group is expected to report pre-tax profits of £35.1m, against £37.6m the previous year. Sales are expected to be about £595m.

Last year, the group was in turmoil when it emerged it had overstated sales and profits. More goods than usual had been offered to trade customers to "load" sales into figures before the end of financial periods, meaning there was excess stock in customers' warehouses.

It said the task of eliminating trade loading was now complete.

Brian Buchan, chief executive, said: "I am pleased that we have achieved our objectives for the year, both in terms of our results and in redefining and refocusing our business.

"Our task now is to ensure that we realise the benefit from re-invigorating our brand portfolio by establishing a firm grip on our operating methodologies and on our cost base.

"These proposed changes underline our determination to deliver a sustained improvement in operating margins.