Ljubljana - Žito, a bread and pasta maker owned by Croatian food company Podravka, plans to shut down two production locations in Slovenia, in Ljubljana and Novo Mesto, in a move it says will improve productivity and long-term profitability.

The decision is in line with the five-year strategic plan confirmed last year to focus on baked goods, the company said late on Sunday. Other production programmes will be "optimised at the level of the Podravka group."

The company said some jobs would be lost but the process would be "carried out gradually, responsibly and in agreement with trade unions."

"We do not wish to speculate about specific numbers, we want to achieve the best possible outcome for the employees in a way that is coordinated and agreed with all internal stakeholders in advance," the company said.

The announcement came after public broadcaster TV Slovenija reported Žito would retain only three production locations in Slovenia - in Maribor, Vrhnika and one location in Ljubljana, in the Vič borough.

Žito CEO Karmen Pangus told TV Slovenija that the optimisation of locations would involve modernisation worth "tens of millions of euros," an investment on a scale Žito has not seen in several decades.

Žito is best known for its baked goods but its portfolio also includes pasta, rice, sweets, teas, spices, and frozen food. It also operates retail outlets around the country.