Help-Link £8m in the red due to diversification and contract loss
LEEDS UNITED sponsors Help-Link saw losses of more than £8m in its last financial year, as over-diversification and the loss of a key contract weighed heavy on performance.
Losses before tax was £8.1m for the 12 months to 31 March 2015, down significantly from £10.2m profit in 2014. Turnover fell from £73.5m to £61.8m.
The boiler maintenance company, which is backed by NorthEdge Capital, said market fluctuations, the termination of a government-backed Energy Company Obligation (ECO) contract in May 2014 and the move into non-core businesses were responsible for its “significant downturn in performance”.
It has received £14.5m from investors since March in an effort to bolster its fortunes and has withdrawn from the ECO scheme to focus on private-sector customers.
NorthEdge pumped £11m into Help-Link when it acquired the business in 2013. Less than 12 months later, the firm bought insulation specialist Miller Pattison for £1m in April 2014.
Poor business performance and difficulties integrating its acquisitions led Help-Link to cut 60 jobs from its Leeds site in December 2014. One month later, co-founder and chief executive Mel Butler and chief operating officer Alan Dickinson stepped down from the board.
All directors who were in charge during the 2014/2015 financial year have now exited the business due to its poor performance.
Former WeBuyAnyCar managing director Richard Harrison, who was appointed Help-Link CEO in August, said the business has been “completely refocused” on its core boiler business over the last 12 months, making private customers a priority.
He said: “Unlike the ECO market, the private installation sector is highly fragmented and offers an exciting opportunity to gain considerable market share.
“The support from our investors has been outstanding and we have undertaken a significant restructuring of our cost base. We have attracted a top quality management team to drive the turnaround of the business and their industry knowledge and expertise will be invaluable to our growth agenda.
“Help-Link’s private boiler sales have already doubled across our national market, and while the turnaround is still in its early stages, progress is being made and we’re all incredibly optimistic about the future.”
The firm is currently secondary shirt sponsor for Leeds United, having previously backed the city’s rugby league club, Leeds Rhinos.
