Testimonial: 73 jobs saved
Great to receive a kind testimonial following a recent successful examinership case resulting in 73 jobs being saved. “We are absolutely delighted with the outcome and are most appreciative of the efforts of you Neil Hughes, your team and your firm, specifically highlighting Conor Noone, who lead the project brilliantly and was most patient in bringing us up to speed on how the process works”.
“Thank you both very much for your help on all aspects of our business. Only for both of you our business would be gone by now. You are both brilliant at what you do I have never had dealing with people that was so good and professional in their line of business. Again thank you and let’s get this business back up and running and bring it to the heights that we all expect it to reach”.
Testimonial: 35 jobs saved
“Great to receive a kind testimonial following our recent successful examineship having saved 35 jobs; “Much appreciation to you Neil Hughes and your team, from our initial contact with your organisation we experienced professionalism, positivity, pragmatism and patience. It’s been a life changing experience and we are just grateful you answered that call”.
Case Study 1: Construction Company
A reputable building contractor with a history of successfully working on large-scale building projects for over 30 years was engaged on six projects at the time Court protection was sought, a number of which related to the provision of social housing units.
The issues faced by the company were:
1. Low gross profit margin in a very competitive market
2. Disputed claim on a project
3. Losses on investment in development lands
4. Unsustainable level of secured debt
The key risk for the company when entering the examinership process was the cancellation of contracts by clients as a result of the application for Court protection. Work had already ceased on a number of the sites due to the uncertainty surrounding the company’s future. However, the appointed Examiner, Mr Neil Hughes, was successful in negotiating with the company’s clients to ensure the continued operation of all viable contracts which the company was engaged on. This was subject to securing investment and the approval of a scheme of arrangement by the High Court. By eliminating onerous and loss-making contracts, the company was better positioned to focus on existing profitable contracts while also actively seeking to secure further work.
The examiner was successful in obtaining new investment and formulating a scheme of arrangement which was approved by the High Court, resulting in 24 jobs being saved while also agreeing a settlement in relation to the secured debt. This ensured the company returned to work on viable ongoing projects which is now allowing for the completion of much-needed social housing units.
Case Study 2: Multi Unit Retailer
This retailer operated from 7 shopping center units and traded profitably for many years before becoming loss making following the onset of recession.
The critical issue faced by the company was being tied into long term upwards only onerous leases at far above market terms. All other variable costs of the business were successfully reduced in line with turnover by the directors but the company was unable to reduce its main overhead; rent.
The company entered Examinership and the weakest trading store was immediately closed. Negotiations took place with other landlords using the framework of the Examinership and reductions of between 50 – 80% were achieved. The reductions were sufficient of themselves to turn around the company’s fortunes and render the company profitable.
A cash business, the company operated at a surplus during the protection period and utilised that surplus to fund a scheme of arrangement for all creditors. The company emerged debt free following the 100 day process with 6 stores still trading and 25 jobs intact.
Case Study 3: Mechanical Engineering Contractor
This group of companies consisted of two trading companies and two holding companies. The trade of the companies was a mechanical engineering company and the installation of pre-insulated and pre-pack panels of ducting. The two other companies in the group acted as shareholder for the group and with the other holding intellectual property rights for its products.
The companies traded profitably for a number of years up until 2016 when it started to experience difficulties. As with any contracting company the loss on specific contracts precipitated the companies’ insolvency. Other issues faced by the company were:
- Cash flow problems
- Threat of winding up orders from trade creditors insurers
- Delay in securing investment
- Loss of key management
The key risk for the companies when entering the examinership process was the loss or cancellation of contracts as a result of seeking the protection of the Court. However, the appointed Examiner, Mr Neil Hughes, was successful in negotiating with the companies’ clients to ensure the continued operation of all contracts the companies were engaged on with the exception of one. This contract was onerous and loss making and as a result of the scaling back of this contract during the examinership the companies were able to focus their resources on more profitable contracts to ensure the survival of the companies.
The examiner was successful in obtaining new investment and formulating a scheme of arrangement which resulted in the saving of over 70 jobs in the West of Ireland.
Case Study 4: Hotel
This Company was involved in the operation of hotel, night club and bar in County Wicklow. The Company’s business commenced in 1984 and the hotel traded profitably for a number of years.
However, the following difficulties for the company became very apparent:
- Difficulties in the hotel sector as a whole, including over supply of hotel rooms as a result of tax incentives in the sector
- Management issues
- Significant contingent liabilities as a result of third party claims against the Company
The company became insolvent and entered Examinership in. Neil Hughes Examiner at Baker Tilly was appointed examiner to the company.
Over the course of the 100 day protection process, new investment was secured for the company from the existing directors. The Company reduced its costs, secured a tax clearance certificate and returned to profitability.
The company emerged from Examinership after reaching agreement with its creditors to pay them a 10% dividend on their debts. The Revenue Commissioners were paid 20% in full and final settlement of arrears.
The scheme was approved by the High Court and the company exited the process with 45 jobs intact and all historic creditors fully discharged through the scheme of arrangement.