Lymington Boat Makers Ltd, formerly known as Scorpion Ribs Ltd, owed around £1,845,500 to creditors when it entered administration earlier in 2024.
In the joint administrators’ report, the company is listed as owing Athens based Ribco two sums – one of £45,610.46 and one of £10,827.30, while Hampshire based John Holden is owed £671,451.
In addition, Shropshire based Montar is owed £457,846.92 and West Sussex based company executive Vincent Patrick and Mary Byrne are owed £324,571.87.
Other notable debts include £13,015.80 owed to Isle of Manbased International Contract Engineering Ltd, £6,300 owed to Solent Rach Farm Ltd of Lymington, Hampshire, and £5,000.26 owed to Yamaha Branch UK, Surrey.
There are also two sums owed to HMRC debt management of £23,231.83 and £21,140.08 and £24,166.77 owed to Lloyds Bank.
In their report, joint administrators Nicola Layland and Carl Faulds state the company was incorporated in 1996 as Scorpion Ribs Ltd, designing, building and selling RIBS around the world.
In 2012, the intellectual property (IP) of the company was sold to a connected company, ERJ Estates Ltd, with an agreement that Scorpion RIBS would pay a licence fee for using the IP.
Rise in material prices
The company was significantly impacted by COVID 19 pandemic with the accounts showing a £10,000 loss for the year ending June 2020 and a £204,000 loss for the year ending June 2021, however overheads were reduced to mitigate the reduction in turnover and in the year ending June 30 2022 the company made a £40,000 profit.
The administrators explain that the company continued to experience difficulties with the Russian invasion of Ukraine resulting in a rise in material prices which caused cashflow issues in the latter half of 2022.
Increased costs could not always be passed onto customers and there were also longer lead times for orders which caused significant delays to ongoing contracts.
The company was not able to start any new work as it did not have the space to do so until existing orders were finalised and cleared from the premises.
“In 2023, the company was continuing to struggle with cashflow difficulties, and it was not attracting new orders,” said the administrators’ report.
Potential investment in the company did not materialise and the company’s bankers declined to provide a new overdraft facility which caused significant cashflow issues.
Advice was sought from the administrators in February 2024 and the decision was made to cease trading as there were no ongoing orders and the company didn’t have the funds available to meet its ongoing costs, particularly salaries going forward.
“We have concluded that it was not realistic in practice to be able to rescue the company as a going concern,” said the administrators.
A buyer is currently being sought for the business assets.
