Fri, 09 Jul 2021 | ADMINISTRATION
WRW Construction, one of the leading construction firms in Wales, is set to collapse into administration after being “put under significant financial distress”. The Llanelli-based company said that several recent events, “including an unfavourable adjudication outcome”, had contributed to the business’ situation.
The firm, which has Cardiff and Bristol locations in addition to its Llanneli base, has ceased to operate and is set to appoint administrators next week. The collapse comes despite the company having what it describes as “a significant order book of over £60m to be delivered within the upcoming 12 months”.
In a statement, the firm said: “The directors have worked tirelessly with their advisors and funders to look for solutions for the business to remain viable. Unfortunately, it has been regrettably determined that no viable options remain, and administration is the best course of action to preserve value for stakeholders and creditors. As a result of this, the directors are in the process of placing the company into administration.”
WRW’s most recent accounts cover the year to December 31 2019 and show the business holding fixed assets of £876,093 and current assets of around £27.5 million. At the time, the company owed £19.2 million to creditors within one year and close to £4.5 million falling due after more than one year.
This left the business with net assets of slightly over £4.5 million. In the same reports, WRW reported post-tax profits of £1.3 million on turnover of £64 million. This revenue reportedly makes the firm the largest UK construction business to collapse since Styles & Wood in March 2020.
In March 2019, the firm received a “significant” lending facility from alternative lender ThinCats which it said would “stand the business in good stead for many years and provide a secure platform for further growth”. This was secured against the business’ property and other assets and was expected to be followed by further ThinCats funding by the close of June 2020.
However, these growth plans were likely significantly impacted by enforced site closures at the start of the COVID-19 pandemic and the ongoing disruption the crisis has caused, before being compounded by the recent events that pushed the company into administration.
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