Fri, 12 Jul 2024 | ADMINISTRATION
A caravan dealer headquartered in Warwickshire has fallen into administration and ceased trading, with administrators from FRP Advisory set to market the company’s assets for sale. Broad Lane Leisure is a family-run firm that has supplied specialist leisure vehicles, including campervans, caravans and motorhomes, across the UK since 1971.
Despite its longstanding place in the industry, however, the company had recently suffered as a result of challenging trading conditions, primarily due to a drop in demand. This ultimately led to cashflow difficulties that severely impacted the business’ ability to continue trading.
FRP Advisory’s Ben Jones and Raj Mittal were subsequently appointed as joint administrators on July 9 and the business ceased trading. 34 employees were made redundant upon the appointment of the joint administrators, with a small number retained to assist in the process.
Joint administrator Ben Jones commented: "Unfortunately, mounting pressures resulted in the business being unable to meet its financial obligations.”
"Regrettably, this meant ceasing to trade and reducing the workforce to a skeleton staff. We are supporting the employees affected to file claims with the Redundancy Payments Services.”
"We are now exploring options for the business and would encourage any parties with an interest in acquiring the business' assets to make contact with us as soon as possible."
Broad Lane Leisure Limited’s most recent accounts at Companies House cover the year to January 31 2023. During that period, the business reported revenue of £23.8 million, up from £21.5 million a year earlier, while operating profit increased slightly from £1.06 million to £1.15 million.
Despite the improved performance, however, the company’s director noted that the business had “started to notice changes in the market”, with a post-COVID bounce beginning to slow down and stock levels starting to rise.
The report stated that “there is feeling that the market is turning from being a seller’s to a buyer’s” as a result of an increase in choice and added that the company finished 2022 with more “new caravans than we would ideally have liked.”
The report clarified that these units would attract interest charges and would have to be offered at “sale prices”, potentially leading to a reduction in margin.
At the time, the company’s fixed assets were valued at £3.1 million and current assets at £11.1 million. However, significant debts meant that its net assets at the time totalled just £1.3 million.
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