400 jobs have been lost at Warwickshire building firm EIC after cash pressures forced it into administration.
Kevin Coates, Sarah O’Toole, and Catherine Williamson of advisory firm AlixPartners were appointed joint administrators last week and reportedly a winding-up petition from HMRC was the trigger for the company’s collapse.
In a statement, the administrators said: “The company’s financial distress was driven by increasing pressure from its creditors as a result of a poor recent trading performance, underpinned by an ever increasing competitive market.
“After exploring all options available, management concluded that the cash pressures were too great and there was no alternative but to place the company into administration. As a result the business will cease to trade with immediate effect.”
398 workers were made redundant, with 10 kept on to assist the administrators.
The group reported pre-tax losses of £1.4m in 2014, the most recent year it has filed accounts for, on revenues of £73m. This followed a £4.8m pre-tax loss in 2013, caused by an exceptional writedown after “the deliberate mis-reporting of project profitability and significant cost overruns by a regional director”.
EIC underwent a £40m management buyout in 2008, backed by Royal Bank of Scotland.
Its most recent accounts, signed off in June 2015, included a going concern warning and noted the financial covenant tests it was subject to, which included an assessment of leverage, cash flow cover and interest cover.
In addition to its Alcester headquarteres, EIC had six regional offices in Warrington, Bristol, Southampton, Exeter, Redruth and North Lanarkshire.
