Thu, 09 Feb 2023 | ADMINISTRATION
Administrators from Mazars LLP say they are seeking to sell the business and assets of Manchester-based floor specialist Malin Industrial Concrete Floors Ltd. The company has fallen into administration despite reporting strong growth in recent years, with insolvency action soaring in the UK construction sector.
Malin produces specialised flooring, mainly for the warehouse sector. The company primarily works with laser screed flooring, a process in which machines trim concrete slabs to exact sizes, before lowering them into place. The company was founded in 2000 and produced warehouse unit flooring for a range of major contractors, with customers including McLaren, Sir Robert McAlpine and Buckingham Group.
In the year to March 31 2021, the firm’s turnover fell to £25.6 million, from £38.4 million a year earlier, as the construction sector was hit by severe disruption during the COVID-19 pandemic. However, pre-tax profits rose sharply from £109,000 in its 2020 accounts to £1.3 million in 2021, an increase of nearly 13x. Gross profits, meanwhile, increased from £4.4 million to £5.6 million.
At that time, the company said that, despite the impact of COVID-19 – which saw its sites closed for several months – it had strong cash reserves and expected to return to pre-pandemic levels of revenue and report a strong profit margin amid a growth in sales.
The company’s performance was particularly boosted by the huge increase in demand for warehouses amid the surge of online shopping in the wake of COVID-19. This growth saw the company expand its average workforce to 50 full-time staff from its previous headcount of 31.
In its most recent accounts at Companies House, the company reported £682,621 in fixed assets and current assets of £8.9 million. At the time, the company’s net assets were valued at £2.97 million.
Read about increasing levels of distress at UK construction firms and what this could mean for M&A in the sector.
Read about finding M&A value during an economic downturn.
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