Administrators highlight over-optimistic profit forecast as key to company failure.
Price Waterhouse Coopers (PWC), the company appointed as administrator for Masterton, has issued an official statement that highlights the factors that led to the failure of the company’s business.
“Masterton secured several large contracts in 2012, delivering strong revenue growth. However, it soon became apparent the contracts weren’t as profitable as first hoped, and despite a strong order book, the firm became reliant on its parent company for support,” says joint administrator Alan Brown. “In response, the directors re-evaluated their long term strategy in 2014, seeking to restructure the business through a Company Voluntary Arrangement (“CVA”) with support from a boutique turnaround and restructuring firm. Despite this course of action, the directors were unable to deliver the anticipated revenue streams needed to maintain and develop the business or meet the terms of the CVA proposal. After discussions with the existing lenders, suppliers and customers, the directors have taken the difficult decision to reduce the workforce and place the business into administration. Our immediate priority will now be to work with the remaining employees, suppliers and customers to realise the value in the company’s assets and contracts.”
In the lead up to the appointment of PWC, Masterton had gradually reduced its employee base with 28 people based in regional locations across the UK made redundant in recent weeks. A small number of staff have been retained to service remaining client contracts.
Any expressions of interest in the company’s business or assets should be made to the Administrators team as soon as possible.
