Henry Stone shortfall revealed
Friday, June 1, 2018
Henry Stone had less than £1,000 in the bank when it went bust earlier this year, and left behind a total shortfall of almost £3.5m.
The parlous state of the finances at the Banbury sheetfed printer has been revealed in the report by joint administrators Geoffrey Rowley and Philip Lewis of FRP Advisory.
It states that factoring firm Leumi withdrew its facility shortly before the administrators were appointed in March, while shareholder TVI Group “was unwilling to provide additional support”.
The absence of funds meant FRP was unable to trade the business while looking for a potential buyer.
“As no support was provided by the secured creditors to fund this process nor by the shareholders and with less than £1,000 in the bank account on appointment, it was decided that Henry Stone would stop trading with immediate effect with all 101 staff made redundant,” the administrators said.
Unsecured creditors were owed a total of £2.63m and are not likely to receive any form of distribution. The firm left a total deficiency of £3.47m.
The historic printer's former owner, Sir John Madejski, was also left out of pocket to the tune of £81,704, understood to be related to property he still owned that was occupied by Stones.
Close Brothers Asset Finance was owed £2.9m secured on assets with a book value of £3.8m and an estimated realisation of £2.16m.
Amicus Asset Finance had a debt of nearly £277k, secured on a Stahl folder with a book value of £315k and an estimated value to realise of £125k.
HMRC was owed almost £210k in unpaid PAYE and National Insurance contributions, while employees were owed £116k in wage arrears, and £768k in redundancy pay. There was also a £19.4k pension liability.
Oldbury-based print manager and marketing services firm Media Print Group, which trades as Media Group, was the biggest trade creditor, listed as being due nearly £300k.
It supplied materials to Henry Stone, and was also the printer's largest client.
However, director Dean Brettle told PrintWeek that the firm's exposure was actually less than the figure stated. "When the actual finalised report comes out things will be a lot clearer. The debt is nowhere near the amount on the current report," he said.
FRP said it had received a number of retention of title claims regarding the paper stock at Stones, and had been reviewing the claims and facilitating collection where applicable. It has also retained some stock owned by third-parties "to provide an incentive to customers to pay their outstanding debts".
Paper and materials business Materias Sourcing was owed more than £244k. The Tilbury firm also had a £36k bad debt with failed sister company Stones Ashford and was itself placed into liquidation earlier this month, owing its own unsecured creditors more than £400k. PrintWeek understands that the bad debts caused the firm's demise.
Henry Stone directors Richard Walsh, Mark Scurr, Steve Ottley and Paul Colley were owed £28.9k, £23.7k, £12k and £12.5k respectively.
The FRP report confirmed there had been one interested party willing to try to resurrect the business, but they had been unable to agree terms with Close to acquire the necessary assets at the Banbury site.