On 5 September David Price Food Services entered a Company Voluntary Arrangement (CVA) that will see its unsecured creditors paid 38p in the pound on debts of about £2.1m.
The Hub has just obtained a copy of the Newcastle hauliers’ financial report for the year ending 25 August 2012 – which contains several details regarding the chilled food specialists’ current financial state.
At the end of its financial year David Price Food Services had net current liabilities of £2.1m and made a pre-tax loss of £686,421.
However its financial year 2012 was a marginal improvement on 2011, with turnover up from £13m in 2011 to £13.9m in 2012. Despite this is made a bigger pre-tax loss, this time £979,804.
The directors’ report 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”.
The report also shows that the business is having to make monthly payments over the next five years to pay off £900,000 of debt as part of its CVA agreement.
Tough times
Times are tough in palletised chilled freight. Look at the performance of Fricor, parent company to Peter Green Chilled. Its annual report for the year-ending 31 March 2012 shows it too is making a loss of £177,925, albeit an improvement compared to a loss of £243,547 in the previous financial year. Turnover struggled too, falling from £16.8m to £15.7m.
During the 12 months it had to close one of its warehousing sites because of “continuing capacity under-utilisation”.
Margins too “have been squeezed in difficult market conditions”.
No wonder Stobart Group decided to get out of palletised, chilled, freight.