What other stories did you miss this month?
Not many business owners and directors would have thought they’d look back on March 2022 as the good old days but with impending trouble coming from several directions at once at the end of the month – they might be.
Energy prices are due to rocket for businesses without the protection of a domestic price cap and several other essential expenses are also rising at a record rate of inflation.
So what other business and insolvency stories have happened and what administration, CVA and liquidation stories have you missed this month?
Dawnfresh Seafoods
Two Scottish seafood producers went into administration this month.
Dawnfresh Seafoods operated seven fish farms across Northern Ireland and Scotland as well as operating two processing facilities near Glasgow and Arbroath.
200 positions were cut immediately at the Glasgow plant while 77 staff were retained to assist with the winding up process.
One of the UK’s largest producers of fish and seafood, Dawnfresh processed 10,000 tonnes a year across 350 product lines but the business began to suffer from rising costs, overcapacity at the plant and cash flow problems.
While the Arbroath facility was sold to Lossie Seafoods, administrators will continue to try to find a buyer for the farming facilities and realise value for creditors from the remaining business assets.
T M Lewin
British online menswear retailer T M Lewin has gone into administration for the second time in two years as a result of loss of trade throughout the pandemic.
Founded in London over 120 years ago the brand grew to operating 150 shops worldwide by 2020 but following the initial impact of Covid and subsequent lockdowns entered insolvency and moved to an online-only model trading exclusively within the UK.
Subsequent mandates restricted event and social gathering attendance along with extended work from home guidance which continued to negatively impact trade. The cumulative impact on the company’s cash flow meant it had to return to administration this month.
A spokesperson said: “Over the course of the pandemic men’s apparel and formalwear has been one of the hardest hit parts of the retail sector. Despite the company undergoing significant restructuring the impact has continued to be severe.”
Cecily’s Ice Cream
The vegan ice cream brand which appeared on the TV show “Dragon’s Den” and had been stocked in Marks & Spencer and Ocado has been forced to close due to supply chain disruption and CO2 shortages.
Cecily’s used coconut milk and sugar to produce its range of flavours and had since its launch in 2015. It won several awards and expanded into overseas markets including Dubai and Hong Kong but rising raw material costs and a number of supply issues meant the business was unable to fulfil orders for its retail listings with a knock-on effect on cash flow and margins.
A spokesperson said: “The founder worked hard to establish the company and its brand but extensive efforts to fund the business going forward proved unsuccessful as did attempts to try to rescue the company as a going concern.
“The business entered liquidation but it was subsequently sold to an independent third party including products and branding.”
Four Cecily’s employees were made redundant as a result of the liquidation.
Welcome to Yorkshire
Welcome to Yorkshire – the tourism body that brought the Tour de France to the county – has gone into administration after council funding was withdrawn.
The Yorkshire Leaders Board which is a body made up of council leaders and metro mayors from across the county issued a statement that it had unanimously agreed a new approach was needed to the marketing of the Yorkshire region and they could not commit to a multi-year funding package for Welcome to Yorkshire meaning it could not continue in its present form.
As a result, Peter Box, Chair of the group announced that “with deep regret” decided to place the organisation into administration.
A spokesperson said: “Yorkshire’s local and combined authorities also agreed to take time to further engage with businesses to develop an organisation that will meet the needs of both public and private sector clients and bring wider benefit to the region.
“Leaders will meet again in May 2022 to agree the timeline for the establishment of the new organisation.”
The decision has been made six months after Welcome to Yorkshire announced that its flagship cycling race had been cancelled this year because the pandemic combined with escalating financial challenges meant it had become unviable.
Remy Automotive
The UK arm of Remy Automotive – a motor parts remanufacturing business -has appointed administrators in the hope that significant parts of the wider group can be rescued.
The group dates back to 1896 and operates globally but the UK based subsidiary was unable to maintain the level of funding it had enjoyed in previous years due to the pandemic.
A spokesperson said: “There is a fundamentally sound and viable remanufacturing sales and distribution business within the Remy group, of which Remy Automotive UK is an important part.
“Historic group-wide balance sheet issues can now be overcome using insolvency processes to restructure the assets so it will hopefully be possible to rescue significant parts of the group.”
Hollicom
Hollicom, a renowned Scottish PR agency, has gone into liquidation as it was ultimately unable to pay off its accumulated debts.
The business entered provisional liquidation in February due to a mixture of rising costs and unsustainable debts but was formally wound up in court in March.
The company had already ceased trading and all seven members of staff had been made redundant.
A spokesperson said: “Hollicom was a well-known communications and public relations business with a high-quality client base – unfortunately, the business was unable to weather the financial pressures of rising costs and a marked downturn in several of its key client markets, of which many were severely affected by the Covid pandemic.
Sven Christiansen
150 positions were lost when Sven Christiansen, a black country based furniture manufacturer, went into administration this month.
Formed in 1975, the business sold all remaining furniture in its showrooms and design studio while all machinery and equipment was going to be auctioned.
A spokesperson for the company said: “Efforts to find a buyer for the company have been unsuccessful despite registering record customer orders.
“Its working capital was negatively impacted by the Covid-19 pandemic and Brexit and as a result the company had built up a considerable debt pile during the pandemic and performance was said to have been disrupted by the implementation of new IT systems.
“The cash flow issues were such that, following the lack of a buyer for the business as a going concern, the directors had no alternative but to cease trading and to place the company into administration.”
RoadBridge
Civil engineering specialist Roadbridge UK which was working on the HS2 rail scheme in two locations along with others has gone into administration with the loss of more than 200 positions.
The business was also working in several locations across Scotland including the Seagreen wind farm off the coast of Angus and was headquartered just outside of Bellshill in North Lanarkshire.
At the time of the administration the business had contracts for various projects worth up to £60 million.
Administrators will explore the options for the business in the coming weeks.
Heritage Pensions
SIPP operator Heritage Pensions has appointed liquidators after consultation with the Financial Ombudsman Service and taking professional insolvency advice.
The directors of Heritage recognised the firm was insolvent and made the decision to place the business into liquidation. This was a result of the firm being unable to pay the redress due from the FOS final decisions on the due diligence completed by the firm prior to taking on some investments in its SIPP.
The Financial Services Compensation Scheme (FSCS) is processing customer claims against Heritage and investigating whether they meet qualifying conditions for compensation.
Salisbury Comedy Festival
The company behind the Salisbury Comedy Festival and Origin Festival has gone into administration and the event has been cancelled.
They were due to take place on August 7 this year and had headliners including Frankie Boyle, Dara O Briain and Seann Walsh.
A spokesperson for the organisers said: “It is with deep regret that we announce the cancellation of Salisbury Comedy Festival and Origin Music Festival.
“Last summer we made the very difficult decision to reschedule the festivals due to a lack of government direction surrounding larger scale events.
“Despite the financial consequences, we were determined to create a positive impact in the community and so focussed our efforts on delivering a series of smaller events over the summer and autumn. These events did not achieve the sales we anticipated, putting the company in a challenging financial position.
“In October we decided to pause activity with a view to relaunching the festivals in the Spring. Unfortunately, our plans to maintain a steady income over Christmas were impacted by a shift in government guidelines where the public was encouraged to avoid the hospitality sector. This had such a profound impact on our income stream that we had no choice but to close the business.
“It is hugely disappointing that we have been forced to close the company and we understand that this impacts many people. Please be assured that we did our absolute best to deliver something positive for Salisbury. There is no wrongdoing, corruption or scam. As Directors we are responsible for our actions, and we will be held to account through the insolvency process.”
Steptronic
Northampton based footwear firm Steptronic have gone into administration this month.
The business sold its shoes online and at over 3,000 high street outlets and up until the end of 2020 had made a profit of over £51,000.
The business as a whole is for sale wholly or individual assets can be purchased. A spokesperson said: “The retail sector has faced a number of well publicised challenges and coupled with shipping and supplier delays and a legacy balance sheet debt, the company was unable to meet its liabilities.”
Bisset Adams
The London-based architects that designed the Blackpool Conference Centre and the Idea Store programme for Tower Hamlets Council have gone into liquidation with the loss of 15 positions. It was currently working on one project – the interior stages of Southmere Library at Thamesmead.
Sarah Godowski, a director of Bisset Adams, said the business’s collapse was an “absolute tragedy” and that Brexit was top of the list of reasons why the practice was unable to survive.
“We had a lot of work in Europe on the automotive side of the business, and over the last years we experienced a slow decline – we tried everything we could to keep going.”
She added that profitability in the sector had fallen away relative to other parts of the construction industry.
“There has been a race to the bottom for fees and it has become a very onerous profession in terms of liability and responsibility. Fees are also lower than we accepted 20 years ago so it’s very difficult.”
JC Rook & Sons
Kent based high street butchers JC Rook and Sons has gone into administration seeing 11 shops and a factory close with the loss of 155 jobs.
A spokesperson blamed poor trading during the pandemic for the company’s downfall.
They said: “The company suffered trading losses in the wake of the Covid-19 pandemic, primarily due to constraints from lockdown closures which were then exacerbated further through the Omicron variant in late 2021 during what would be their peak season in the run up to Christmas.
“The directors concluded that with the deteriorating trading position, the company would need to go through an insolvency process. Following legal advice, they made the decision to close all 11 stores and cease operations at the production facility in Ramsgate. Regrettably, with trade ceasing, the majority of the company’s 155 employees have been made redundant with a small number of staff retained to assist the administration process.”
Keenan of Ayr
60-year-old Scottish coach firm Keenan of Ayr has gone into liquidation with 18 positions being made redundant.
At the time of the liquidation the business held 14 contracts with eight different schools which were reallocated by South Ayrshire Council.
A spokesperson said the business had endured a difficult two years through the pandemic with many pupils forced to learn from home and additional hires for events such as weddings or sports days also falling and negatively impacting the company’s cash flow and ultimately rendering it unviable.
Safe Hands
Wakefield based Funeral plan providers Safe Hands have gone into insolvency leaving the existing arrangements of 45,000 customers in doubt.
As the business has gone into administration it means that refunds cannot be issued until the business’s circumstances have been explored.
A spokesman said: “Joint administrators have been appointed by the court to undertake a detailed statutory investigation of the financial position of the business and the events leading to the insolvency.
“This will support our work as we progress towards realising the company’s assets to make returns to creditors.
“Regrettably, the administration means the company is not in the position to issue refunds at this time. We appreciate how upsetting this period of uncertainty will be for Safe Hands Plans’ customers and their families but administrators will contact all plan holders and their representatives to outline the process for registering claims.”
The business had been in discussions with the Financial Conduct Authority (FCA) before entering administration acknowledging that the company was unsustainable in its current form after a period of severe financial challenge.
Union Jack Radio
The comedy and music themed DAB radio station Union Jack Radio entered administration this month.
It broadcast weekly stand up comedy and had comedy programmes in its schedule rather than just music.
2022 is not going back to normal – this is normal now
Any sole trader or business director looking for a return to a “normal” trading environment will be disappointed in 2022 so far.
At best it looks like we’re swapping one problem for another but with the end of the month approaching there is still a window of opportunity to act and make the start of April more positive.
The best way to do that is to arrange a remote and free consultation with one of our experienced advisors.
When you’ve chosen a convenient date and time, they’ll contact you to discuss your unique situation and more importantly, what options you have available to improve and strengthen your business.
Generally, the sooner you act, the more options you will have and with days before the start of the new financial year, this could be the last chance to be able to use some of them.