Tyne and Wear-based David Price Food Services has gone into administration just over a year after entering a Company Voluntary Arrangement (CVA).
The chilled haulage division of the business stopped trading with immediate effect today - with 109 employees made redundant – but its cold storage division, which has facilities in North Shields and Glasgow, has been sold to Ice Company Distribution with 29 jobs retained.
Its haulage operations were based at six depots in Bristol, Bury St Edmunds, Glasgow, Gillingham, Wrexham and South Kirby in Yorkshire.
Five employees at David Price Food Services’ head office in Wallsend will be retained in the short term to assist with the administration.
KPMG
Howard Smith and Mark Firmin of KPMG’s restructuring practice have been appointed as joint administrators. They stated the collapse of the operator was due to a period of poor trading and an increased cost base, primarily due to rising fuel and utilities costs.
On 5 September 2012 David Price Food Services entered a CVA that would see its unsecured creditors paid 38p in the pound on debts of £2.1m.
However in its financial report for the year ending 25 August 2012 the directors said that “there is still a material uncertainty regarding the company’s ability to continue as a going concern, as the company needs to increase turnover and reduce costs further to trade at a sustainable level to generate positive cash flows”.
Its financial year in 2012 saw a marginal improvement on 2011, with turnover up from £13m in 2011 to £13.9m in 2012. It made a bigger pre-tax loss of £979,804, compared to £686,421.
