A MAJOR manufacturer and employer has announced 89 job losses raising concerns about its future.

Paper tissue manufacturer Accrol Group Holdings plc, based on Roman Road in Blackburn, has also revealed it is talking to its banks and shareholders regarding 'short term' finance requirements.

The announcement of the redundancies, a sixth of its current 535-strong workforce, bring an end to three years of rapid growth which has seen the opening of a new factory in Leyland and a warehouse and distribution centre in Skelmersdale.

Its workforce has increased steadily from 214 in May 2014 with only short-term fluctuations in the number of casual employees and in January this year bosses said it was 'wedded to further growth'.

Blackburn MP Kate Hollern said: "I am really disappointed and very concerned at these job losses.

"It looks as though the company may have over-extended itself in recent times."

Miranda Barker, chief executive of the East Lancashire Chamber of Commerce, said: "I am always concerned at job losses and hope this is just a short term rather than a long term problem.

"Accrol works in a market, which experiences a lot of fluctuation so there are always worries about rapid expansion over-extending a company."

Last month the company suspended dealings on the junior AIM stock market because of 'more challenging trading conditions’ and a potential fine of up to £2.9million over an employee suffering a serious finger injury.

Yesterday, an Accrol spokeswoman confirmed the job losses are expected to be concentrated at its Blackburn headquarters complex of two factories and a warehouse.

She said: “During the operational review currently being undertaken at Accrol Papers, it has been identified that a number of significant improvements should be made to the operational cost base of the business.

"As a result and with regret, the management has today announced a proposed reduction in headcount, totalling 89, across the business.

"A consultation process is underway, which will be concluded within 45 days.”

In a separate statement to investors the company has confirmed its share dealings remained suspended, adding: " The board is confident that, while there can be no guarantee, a solution will be found to the company's short term funding requirements.

"The directors continue to review the position and, as part of this review, the company is engaging with its major shareholders and its bank."

Mrs Hollern said: "I want Accrol to remain and expand in Blackburn with Darwen and hope this is just a short-term blip.

"I would urge them to work with the borough council to try and retain these jobs as recruiting and training staff is a very expensive business."

Cllr John Slater, leader of Blackburn with Darwen Council Conservative group, said: "I am very worried about these job losses.

"I am concerned because they are major firm in the borough.

"We have all enjoyed watching Accrol's rapid expansion but there must now be worries the firm may have over-extended itself."

The business was founded in 1993 by Jawid Hussain and became the UK’s leading tissue converters and manufacturers, producing and distributing brands such as Softie, Triple Softie, Mega and Handy as well as several supermarket ‘own label’ lines.

Since 2014, the firm has seen its annual turnover break the £100m mark, been sold by the Hussain family, and floated on the AIM Stock Market in May last year.

Share dealing was suspended in October, a month after the appointment of new chief executive Gareth Jenkins.

The latest update statement on AIM share dealing said Accrol's director believed that 'the current challenges facing the company' relate largely to the financial year to April 30, 2018 and are 'likely to have less of an impact on the company's trading performance' in the 12 months to April 30, 2019.

Last month Accrol Papers pleaded guilty to a health and safety offence at Manchester Magistrates Court.

The charge arose out of an incident in May 2016, when an employee suffered a serious injury to the top of his right index finger.

The Health and Safety Executive indicated it was seeking a fine in the range of £550,000 to £2.9m.

The company hopes for a discount on the penalty in view of its early guilty plea.