ICSM Credit's August Newsletter: firms sell assets to save themselves; Harry and Meghan liquidate foundation; print's 'new world order' and 'we should have done a Sweden'

ICSM Credit's August Newsletter: firms sell assets to save themselves; Harry and Meghan liquidate foundation; print's 'new world order' and 'we should have done a Sweden'

 

The Sale of the Century (for those of tender years) was a popular ITV show that ran from from 1971 to 1983, hosted by Nicholas Parson

ICSM Credit's August Newsletter: firms sell assets to save themselves; Harry and Meghan liquidate foundation; print's 'new world order' and 'we should have done a Sweden'

Hello and welcome,

They have come to be the go-to way out of the economic disaster of the Covid-19 business shutdown. Few sectors have not been affected with trade falling off a cliff for many or drastically reduced for others. With historic debt and a cash flow crisis zombie companies have turned to CVAs (Company Voluntary Arrangements) to dump debt, get rid of staff, cut costs and even force landlords into rent holidays. And CVAs are the sale of the century with anything from a printing press to a company car up for sale at knocked down prices as firms metaphorically throw anything they can overboard to stay afloat.

Everyday firms are using these sticking plasters to stave off insolvency so as to live to fight another day. My problem with CVAs is the onus is on suppliers to agree to them. Otherwise liquidation is the nuclear option - back us and get some of what we owe you or get nothing if we go bust.

CVAs can simply put off the inevitable if the same failed business model is followed after the creditors agree to it. It is unrealistic to think nobody will have to take a haircut, as CVAs by their nature write off debt – either now or over a longer period. My advice is once a CVA has been agreed and as a creditor you’ve accepted it don’t allow the firm to take extended credit terms. Trade by all means but at the first sign of a delayed payment – pull out as they’ve broken your terms of business. Once bitten twice shy as they say.

Another common practice since the Covid 19 crisis turned our business world upside down is the return of the phoenix company. We've seen it in the print industry, haulage, construction and retailing - the phenomenon where the owners or the directors of the collapsed company can acquire the assets off the administrators in a pre-pack deal. 

Covid 19 has dominated our lives this year and is set to continue and my line all along like many in business is we simply have to live with it rather like Sweden has. Their economy has been hit but nothing like the level the UK's has been - and we are now facing a recession.

In the meantime business is slowly getting back to normal - and as furloughing ends more zombie firms will crash so it is going to be difficult for many companies and the self-employed.

If you join ICSM Credit you can avoid some of those zombies through our international credit intelligence network where our members let us know who is in trouble and who to avoid.

There's lots more insolvency and business news on the website and on our social media on Twitter, Facebook and LinkedIn - stay in touch and have a great (if shortened) summer.

Best wishes
Ian Carrotte
Proprietor of ICSM Credit
For details about ICSM Credit call 0844 854 1850 or visit the website www.icsmcredit.com or email Ian at Ian.carrotte@icsmcredit.com




ICSM Credit, the Exchange, Express Park, Bristol Road, Bridgwater, Somerset TA6 4RR

Not a member? Normally you can join for less than a tank of diesel and protect yourself from late payers but we have a special free temporary membership offer in August. Use our free legal letters to chase unpaid invoices.

For a video on how to send a FREE LEGAL LETTER visit: https://youtu.be/AIycysoFhYo

NEWS IN BRIEF
 

Harry and Meghan's foundation liquidated

The Sussex Royal Foundation run by Prince Harry and Meghan has been shut down after the couple’s decision to move to the USA and leave the Royal Family. Documents filed at Companies House confirm their decision to close the charitable enterprise as they plan to concentrate on a new charity in North America called Archewell. ICSM Credit understands the Sussex Royal Foundation has not left a trail of unpaid creditors but is a tidying up exercise and effectively a full stop punctuating the end of their activities in the UK but it was owed £200,000 on its closure.

Travel industry rocked by Tui closure

The country's largest travel operator Tui is to shut 166 High Street stores and axing 900 jobs as the devastating effects of Covid 19 continue to hit the industry.
 

New world order for print industry

Jo Francis in Print Week has written a timely piece on the new world order for the print industry which seems to be all about redundancies or calling it a day and shutting up shop. She writes about Dundee-based Tradeprint who are cutting 30% of its 164-strong and Portsmouth’s Bishops Printers who are also making the same number of staff redundant. Francis quotes Bishops Printers CEO Gareth Roberts as saying: “Our ‘event driven print’ has naturally been severely depressed and although we are starting to see recovery – with volumes rising towards 50% of norm in July – we do not see a ‘V shaped’ return to normal trading. It was therefore evident in early May that we would need to restructure throughout all parts of the business to remain viable.  Sadly, this has meant approaching 30% of our 270 strong workforce being made redundant since we simply don’t believe we can carry the additional staff without the work we normally expect for the remainder of the calendar year.”

Oven ready pizza CVA

Pizza Hut hopes creditors will accept a company voluntary arrangement (CVA) so it can restructure its finances and close 75 outlets and sack hundreds of staff. They have hired advisers, Alvarez & Marsal, to explore the possibility of a CVA while one of their rivals Pizza Express are in a similar situation in seeking a CVA and are preparing for the closure of scores of their restaurants.

One solution: flog your assets

One of the world’s largest car rental firms is trying to stave off collapse by selling off thousands of its cars. Hertz has taken a hit from the coronavirus pandemic after a significant portion of its business evaporated nearly overnight as the holiday and business travel industries dried up. In an attempt to save the company Hertz are to sell nearly 200,000 vehicles to raise funds for their creditors at just £800 a car to pull in more than half a billion pounds.

Excuses, excuses, excuses


Not been paid? Given the run around? Use ICSM Credit's free legal letters to get paid - they are 87% successful - or use our debt collection service that's saved members hundreds of thousands of pounds during the crisis. 

Here are some of the excuses ICSM Credit members have been given about late payment:

  • “The cheque is in the post.” Nobody pays by cheque anymore but incredibly this is an excuse still given. The variation is we posted it ages ago so it must be ‘lost in the post.’
  • “The director who signs off payments is on holiday.” Even old school directors have mobile phones on which they can see their emails and messages while sunning themselves in Spain. Don’t buy it.
  • “We haven’t received your invoice.” This one is usually given long after the payment date has passed prompting the time consuming process of starting the process all over again.
  • “The person who authorised the work has left the company and we have no record of the job.” A handy get out of jail free card but it doesn’t wash – you have all the documentation.
  • “We can’t pay without a purchase order.” This excuse irritatingly comes well after the payment date has passed and hasn’t been mentioned before.
  • “We’ve already paid that invoice.” You have to come up with the paper work to show they haven’t paid – at which point they ask for a duplicate invoice so they can ‘process it.’
  • “The amount is wrong.” As always this is given as an excuse long past the due date and after much toing and froing they agree the amount is correct – having bought extra time.
  • “That was the old company that went bust.” Strangely apart from a name change the ‘new’ company is in the same premises with the same people doing the same work.
  • “There’s nobody in accounts.” Your chasing up phone call is answered by someone in accounts but apparently there is nobody there.
See the website for our three part series on late payment and how to deal with the problem https://icsmcredit.com/news/viewpost.php?id=263



Use ICSM's Debt Collection Service

ICSM Debt Collection Service is fast, efficient and highly experienced with an impressive record of securing debts  their clients had long given up on. Paul Carrotte heads up the division. He said: "The court system has remained open throughout the lock down and we have managed to recover tens of thousands of pounds for businesses that desperately needed the cash to ensure they can continue trading. Whether the debts are here in the UK or overseas we have the expertise and global reach."

Contact Paul Carrotte on 0844 854 1850

MORE STORIES FROM ICSM's WEBSITE
SEE THE WEBSITE FOR THE FULL STORIES - AND MUCH MORE


Ethical brand leaves £1m in unpaid invoices

https://www.icsmcredit.com/news/viewpost.php?id=273
 

Health store slammed for late payment

https://www.icsmcredit.com/news/viewpost.php?id=273


Football club calls in administrators

https://icsmcredit.com/news/viewpost.php?id=246

COMMENT: Sweden 1 United Kingdom 0. No lockdown, no compulsory face masks, no economic shut down – Sweden and Covid 19

Sweden’s economy has been hit badly, unemployment is up and many people have died unnecessarily from Covid 19 in care homes due to their Government’s slow response to the pandemic. And yet with their laissez faire approach to minimising the social and economic effects of the virus the death rate per million residents is lower than ours and their economy although damaged is in better shape. The most up to date figures are the UK’s death rate per million is 681 and Sweden’s is 580, while their economy is taking a much smaller hit with GDP down fractionally in Q1 compared to around a 19% drop for the same period in the UK.

The problem Sweden now has is due to the fear factor affecting their economy. Their residents look at what is happening in neighbouring countries and copy their behaviour by not going out, not shopping in shops and not travelling. Sweden is a big exporter of a range of goods with timber one of their classic products. With the rest of Europe in recession orders have dried up which has a knock on effect for the country’s economy. Britain, France, Spain and Italy have all had mandatory restrictions such as lock downs but are in a much worse state than Sweden who we should note has a built in restriction in their constitution which bans states of emergency reflecting the Swedes more individualist attitude to civic life.

As reported on BBC Radio 4’s More or Less programme hosted by fact checker Tim Harford Sweden kept their schools open throughout the crisis with no obvious rise in infections as a result. As in the UK almost all deaths and serious cases were in their hospitals and care homes with most deaths occurring in people aged 80 and above. Keeping schools open freed up workers to go to work and of course as an employer and consumer the education system is a key factor in any healthy economy.

Apart from Ikea, Abba and Volvos the UK can learn a lot from the Swedes. And when it comes to Covid 19 and a future outbreak this winter we should adopt some of their ideas in keeping their economy going during the pandemic. The lockdown was not for nothing as it did save lives, but it was seriously flawed in the way it was operated and has caused an unnecessarily deep recession.

Harry Mottram
 

Big Four given a ticking off

Like school boys summoned to the head teacher’s study for a dressing down the so-called big four accountancy firms - KPMG, EY, PwC and Deloitte – have been told to ring-fence their audit arms from their consultancy units by 2024 following criticism of how they operate.

The Financial Reporting Council (FRC) has told them they must submit separation plans by October so that disasters like the Carillion affair can be avoided in future. Essentially they have given firms a clean bill of health with an audit only for that firm to collapse due to a black hole in their accounts soon afterwards.

The FRC said separating accountancy firms' audit departments from the rest of their operations would help to protect auditors "from influences from the rest of the firm that could divert their focus away from audit quality". Ian Carrotte of ICSM Credit welcomed the move but remained sceptical and said ‘the proof will be in the pudding’ rather than fine words.

He said the big four's auditing of Carillion, Thomas Cook and Wirecard revealed how they had failed society, business and their own shareholders in the past with the Government, businesses and the general public picking up the bill for their incompetence.

STOP PRESS

Sky News are reporting that newspaper veteran David Montgomery has joined forces with a leading turnaround fund to buy Archant - the big regional newspaper publisher. They said: "A takeover of Archant is expected to see the company enter administration before being immediately sold to new owners, according to insiders. Sky News has learnt that Mr Montgomery's listed vehicle National World and the investment firm Endless have tabled a joint bid for Archant, which counts The New European among its stable of titles. Sources said that Archant's advisers at the accountancy firm KPMG were preparing to reach a decision in the coming days about a sale of the business."


Runners and Riders
Below is a collated list taken from the Government’s London Gazette of various  businesses who are experiencing problems in the last few weeks. Ones that catch the eye include DCL Print and Dawson Books in the print and publishing world, while in retail the high profile name of Go Outdoors has gained national headlines, and in professional sport Wigan Athletic FC went under - will there be more?

Administrator Appointment
Albany Brent Limited  44019
Amco Services (international) Limited  44019
1st Choice Scaffolding (Isle Of Wight) Limited  44021
Customade Group Holdco Limited Group  44021
Customade Group Midco Limited  44021
Dawson Books Limited  44007
Education Umbrella Limited 44007
Go Outdoors Limited  44007
Seafood Pub Company Ltd  44007
DCL Print Limited  44019
Customade Group Trading Limited  44021
Fineline Aluminium Limited  44021
Hill Shorter Limited  43868
Impact Catering Services Limited  44021
J A Haworth Limited  44021
J.P. Distribution Ltd  44019
Le Bistrot Pierre Limited  44028
Polyframe Doors Limited  44021
Polyframe Norwich Limited  44021
Poundstretcher Properties Limited  44036
Stevenswood Topco Limited  44021
Stevenswood Trade Centres Limited  44021
Splash News and Picture Agency Limited  44019
Vapiano Limited  44021
Wigan Athletic AFC Limited  44019
Wigan Athletic Holdings Limited  44019
Wigan Football Company Limited  44019
Wigan Property Holdings Limited  44019
Wigan Sports Management Limited  44019

Compulsory Liquidators Appointed s 136
Austin Construction & Management Limited  44021
Cereal Killer Cafe Limited  44021
Future Display & Shopfitting Limited  44021
Hellas Telecommunications (Luxembourg) Il S.c.a.  44014
MJB Air Conditioning Limited  44021
Sebright Cygnets Nursery and Activity Club   44021
Serve Bit Limited  44021
The Catering Design House Limited  44021

Creditors' Voluntary Liquidation Deemed in Consent Meeting
Acorn Stationery And Print Limited  44019
Air-Eze Limited  43868
Bodycombe Logistics Limited  44019
Colmar Construction (Poole) Limited  44019
Dandy Events Limited  44034
Future Display and Shopfitting Limited  44021
Pear Communications Limited  44028
Raprig Design Limited  43868
The Original Art Shop (Staffordshire) Limited  43868

Liquidators Appointed
The Angel Inn (Long Ashton) Limited  44019
Agile Shop Fittings Limited  44021
AK (Lighting & Signs) Limited  44019
Blenheim 1 Design Limited  44032
Blue Key Property Solutions Limited  44021
Clean Energies Investor Limited  44014
Coffeesmiths (South West) Limited  44036
Caffe 16 Limited  44019
CMS Technical Engineering Limited  44019
Damp Proof & Timber Preservation Limited  44014
Detach Limited  44014
D & D Haulage (Dalligan & Daughters) Limited  44021
Design A Frame Limited  44019
Design A Visor Limited  44028
Design And Lifestyle Limited  44019
Extra Windows Limited  44014
Fascia Force Limited  44021
Future Display & Shopfitting Limited  44041
G&G Fitness Limited  44032
Gradans Architectural Hardware Limited
H & H (Retail) Limited  44021
HS Fibreglass Fabrications Limited  44021
Italian Design Limited  44041
JH Building Works Limited  44021
Kingstone Construction Limited 44014
KJV Construction Limited  44028
Mccarron & Co Limited  44021
Martyn's Vehicle Recovery Limited  44041
Newville Construction Limited  44041
North Park Carpets Limited  44021
Plas Panteidal Maintenance Limited  44021
Presland Transport Services Limited  44014
Promote Public Relations Limited  44015
Quill Ink Books Limited  44014
SAF Ventures Limited  44021
Synergy Electrical & Construction Limited  44014
Tariq Halal Meat (Ilford) Ltd  44014
The Base Yorkshire Limited  44021
Trehaven Leisure Limited  44021
Turmeric Bristol Limited  44041
UWSB 2 Limited  44021
Wow Creative Design Limited  44019
Yara Restaurant Limited  44036

Members Voluntary Liquidations
Bristol Community Health C.I.C.  44021
Burrwood Homes Limited  43868
Call Centre Technology Limited  44021
CEM Press Holdings Limited  44007
Collinson Associates Limited  44021
Complete Imaging Limited  44021
Falkland Properties Limited  43868
J E Overment Limited  44021
Lifting Power Limited   44021
M A Roberts Consulting Limited  44021
Micro Librarian Systems  44021
Open Property Services Limited  43868
Ridgeway Consultancy (UK) Limited  43868
Rob Harris Design Limited  44041
Sign Trading Limited  44034
Unicorn Events Limited  44012

Petitions to Wind Up
Hunter Valley Distribution Limited  44022
Cove Construction (SW) Limited  44012
Future Way Homes Ltd  44012
Platinum Gray Building & Construction Limited  44041

Winding Up Dismissal
Ruskins Trees & Landscapes Limited  44021

Winding up orders
CSK Construction Limited  44028
GWA Marketing Services Limited  44021
Portfolio Logistics Limited  44041
Reinvent Media Limited  44021
Symposium Print Limited  22036

ICSM CREDIT

For information on ICSM visit www.icsmcredit.com or call 0844 854 1850.
ICSM, The Exchange, Express Park, Bristol Road, Bridgwater, Somerset TA6 4RR. Tel: 0844 854 1850. www.icsmcredit.comIan.carrotte@icsmcredit.com


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