Connaught talks continue
PUBLISHED: 11:15 26 August 2010
TALKS are ongoing regarding the future of struggling council house maintenance firm Connaught, which started life in Sidmouth.
The discussions come after a tough two months for the company, established as a concrete repair specialist in 1982. It has issued profit warnings, its chief executive Mark Tincknell and finance director Stephen Hill have resigned, and its share price lost 95 per cent of its value.
It is not year clear if jobs will be lost as a result of the business review.
“We are currently in this business review process which looks at what our costs are and staff is one of those costs,” said PR manager Paul Haines.
Factors in Connaught’s problems include uncertainty around future funding for social housing maintenance, and the state of the wider economy. It expects to record a pre-tax loss for its financial year, ending August 31.
Its current debts total £200.6m and it has recently agreed with its lenders, including Lloyds TSB and RBS, an additional £15m overdraft facility.
Rivals Rok and Mears have stated there may be “opportunities” to take on some of its contracts as it works through its debts. Mr Haines said the company had been talking to all of its clients – 150 in its social housing division, including councils and registered social landlords nationwide – and many had been supportive.
Barnet Council announced last week that it was winding up its £7m contract 13 months early in February, stating Connaught’s problems were “jeopardising” its repairs service.
The firm isn’t looking beyond the review. “Although we’re in discussions with our lenders, it doesn’t mean we have a guaranteed outcome,” said Mr Haines. “We’re not going to speculate on anything, but focus on preparing the review.”
If you value what this story gives you, please consider supporting the Sidmouth Herald. Click the link in the orange box above for details.