Chill Factore backers put in £1.9m to halt downward slide

THE OWNERS of the £30m Chill Factore ski slope attraction are having to inject  £1.9m of new equity into the Trafford-based business in order to complete a refinancing.

Bridges Community Ventures, the London-based equity fund run by Sir Ronald Cohen and Worcester-based property developer Pemberstone will put in the cash by the end of the month, according to its chief executive Stephen Evans. 

Chill Factore’s parent company has been in breach of its banking covenants for more than six months and newly-filed accounts show that its net debts have increased to almost £34m. 

Mr Evans told TheBusinessDesk.com that the funding would be used to settle a couple of title claims outstanding since the resort’s construction as well as providing ongoing working capital.

Accounts have just been filed for the year to October 31, 2009 which showed a marginal growth in sales to £7.5m (2008: £7.4m) but continuing pre-tax losses of £1.1m. Its net debt increased by £1.2m to £33.9m and its liabilities outweighed its assets by more than £14m.

Mr Evans, who joined Chill Factore in 2008, said that Chill Factore’s parent company still enjoyed the support of its bank, RBS – to whom it owes more than £25m.
 
“The bank are very supportive and are very comfortable with the way the business is performing,” he said.

Indeed, he argued that in the 22 months since he he has taken charge he has put in measures that have significantly improved Chill Factore’s profitability, such as taking its phone booking system back in-house, offering incentives to potential tenants to reduce the number of empty units and introducing initiatives to boost visitor numbers.

As a result, he said that earnings before interest, tax, depreciation and amortisation have climbed from £800,000 when he took over to their current level of around £2.8m.  

“There are lots of small things that have contributed to our improved profitability,” he said.