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£600k shortfall for creditors as kitchen firm declared insolvent
Published on: 10 October 2007
Following the closure of Winchester-based Shaston Kitchens at the end of August and its declaration of insolvency in mid-September, further detailed investigations by the liquidators at Portland Business Recovery, estimate that creditors now face a shortfall of approximately £600k.
The company commenced trading in 2000, but was sold to two employees in 2003 who have been the directors and shareholders since that time. The company operated from the Winnall Trading Estate selling fitted kitchens and achieved an annual turnover of around £1.8m. Decline in profitability, cash flow difficulties and notification of a potential dilapidations claim from the landlord of £250k, resulted in the directors calling in Portland.
Carl Faulds and James Tickell, both Directors of Portland, were appointed joint liquidators and, following a review, they concluded that the company would not be able to trade out of difficulties and so should cease trading and be wound up. Unfortunately, there was no prospect of saving the business because of the extent of its liabilities and the extent of the refurbishment work to the property required by the landlord. As a result, there was no alternative but to make nine staff and the two directors redundant and to release sub-contract sales and fitting teams.
Portland, the south coasts largest independent business recovery firm, managed to contact 15 customers who had paid deposits for orders which the company was unable to fulfil. Those who had paid by credit card were advised to contact their credit card company for a refund, however, those who had not paid by credit card will have claims in the liquidation, but there is no prospect of a dividend for creditors. Guarantees given to customers by the company are also of no value.
Carl Faulds, Managing Director of Portland, commented: 'Shaston Kitchens had a good reputation in the local community, but were simply faced with insurmountable problems, with the final property claim from the landlord sealing its fate. We are aware of a handful of customers with unfinished kitchens and can provide them with a number of options depending on their circumstances.'
Any of Shastons' clients who have queries can contact Portland's Whiteley office on 01489 550440.
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