Wed, 16 Feb 2022 | ADMINISTRATION
House builder Mulbury Homes has fallen into administration, after suffering from cash flow issues and rising costs, among other pressures. Andrew Knowles and Steve Clancy of Kroll have been appointed as joint administrators and will now seek to realise assets and distribute funds to the firm’s creditors after it ceased trading.
Mulbury was founded in 2010 and is headquartered in Lymm, Cheshire. The business was known for procurement and delivery of affordable housing projects. At the time of its administration, the company had a strong pipeline of existing and future projects, with 1,089 homes under construction.
In January 2021, the company entered a £32 million funding deal with Cheyne Capital to build 144 apartments in a 12-storey development in the New Cross area of Manchester. The company also had ongoing projects in Greater Manchester, as well as in Lancashire and Merseyside.
In its most recent financial accounts, for the year ending March 31 2020, the company reported turnover of £38.4 million, a slight increase from £38.2 million a year earlier, but saw its post-tax profits fall from £14,130 in 2019 to £4,322. At the time, the firm’s fixed assets were valued at £33,895 and current assets at £11.5 million, while total equity stood at £1.17 million.
Despite its strong pipeline of projects, Kroll said that Mulbury had been "struggling with trading and cash flow issues brought by the pandemic, planning delays and rising costs". Upon appointment, the joint administrators ceased trading the business as a going concern, with existing staff made redundant.
Joint administrator Andrew Knowles said: "The continued difficult trading conditions, rising costs, and financial pressures as a result of bad debt has led to a weakened cashflow position which has led to the appointment of the joint administrators."
"The joint administrators are continuing with their duties following the sale, realising assets, and distributing funds to creditors as well as investigating the financial affairs of the company as part of their statutory duties."
In a statement, the directors of Mulbury Homes said: "We had a strong pipeline of projects and we were hopeful for the future. However, we have not been immune to the very challenging conditions facing the construction sector brought by the pandemic, planning delays, cost increases and supply chain issues.”
"We have been working tirelessly to keep the business going but the current conditions left us with no option but to call in administrators.”
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