Report sheds light on collapse of decking supplier

A squeeze on its customers’ disposable incomes contributed to the administration of a previously profitable North West business which supplied premium timber products such as decking, cladding and fencing.

Silva Timber Products supplied exterior products to retail customers, builders, landscapers, merchants and garden building manufacturers.

Historically profitable, the Widnes-based company enjoyed a strong 2021 with customer demand boosted coming out of the Covid lockdown period.

But more recently there was a fall in demand, largely driven by the reduced disposable income of customers on the back of rising inflation.

This in turn led to reduced turnover and cash flow difficulties and impacted the company’s ability to operate.

A loss of £819,000 was incurred in the ten months to October 2023, according to a report by administrators from specialist business advisory firm FRP.

An accelerated sale process was instigated with more than 430 parties approached, but no viable offers were received.

Anthony Collier and Richard Goodall of FRP were appointed as joint administrators of Silva Timber Products.  The majority of the company’s 30 employees were made redundant.

Subsequent to their appointment, the administrators marketed the company’s assets and accepted a £500,000 offer for timber, screws and fixings to an unconnected third party.

The asset sale was led by Hilco Global.

Secured creditor Virgin Money is expected to recover some of the money it is owed, according to the report, but there will not be sufficient funds to make a payment to unsecured trade creditors who are owed about £473,000, administrators said.

Original source: Report sheds light on collapse of decking supplier | Insider Media

(Image credit: Pixabay)

Related Articles

Back to top button