There is a bleak outlook for trade creditors, owed a collective £5.8m, looking to recoup losses from The Colourhouse Limited, according to an administrators report from Duff & Phelps.
The Deptford-based printer entered administration in November 2013 with an outstanding book debt of £1.9m.
Approximately £1.5m was owed to Bibby Financial Services under an invoice discounting agreement, while trade creditors and employees were owed £3.3m and £1m, respectively.
The administrators’ report stated that aside from its book debt, The Colourhouse had negligible assets including its office furniture and IT equipment, due to the fact that almost all of the company’s plant and machinery “was subject to hire purchase or rental agreements, all of which were in arrears.”
Joint administrators Andrew Stoneman and Benjamin Wiles, of Duff & Phelps, stated that they have yet to receive a signed statement of affairs from the directors, resulting in the estimated financial position offered in its place in November.
The administrators estimated the company’s book debts at £1.9; however only £1.4m of this is estimated to be recoverable.
As a result, Bibby Financial Services is expected to suffer a £113,197 shortfall, the consequence of which is that there will be no money left to distribute amongst the company’s unsecured creditors.
Prior to the appointment of administrators, The Colourhouse had ceased trading, having insufficient working capital to pay suppliers for the release of goods and having dismissed its staff of 85.
Lee Reeves, David Arkell and Randle White, directors of the company, claimed the company’s losses were the result of “a bad debt to the value of £130,000 in relation to CSDM,” which was “a failed insurance claim for business interruption which had to be repaid” and suppliers cutting credit.