PZ Cussons, the maker of Imperial Leather and Morning Fresh soap, is closing its Nottingham factory and moving production to Thailand.

The closure of the factory is likely to mean the loss of about 160 jobs over a two-year period as Cussons builds a factory in Thailand to begin production in 2007.

The company said the decline in the soap bar business has dropped more significantly in recent years as people opt for liquid versions, according to newspaper reports today.

The new Thai factory and an existing Indonesian plant will produce bars for the UK market as well as Australia, where Cussons closed its factory last year.

The company said its UK profits were hit by the effect of high oil prices on raw material costs.

Group pre-tax profits for the six months to November 30 dropped 4% to £26.2m compared to £27.3m last year. Turnover for the company rose 2% to £250.7m while operating profits fell 12.5% to £22.9m.

Recently the company has bought into Charles Worthington haircare products in the UK.