Harland & Wolff's ill-fated venture into the ferry service sector, Scilly Ferries, amassed debts of £3m before succumbing to administration earlier this year, according to recent disclosures in official filings.
In a bold move by the former management of the shipyard renowned for building the Titanic, Scilly Ferries was established despite setbacks including financial turmoil and a delayed launch, ultimately ceasing operations without completing a single trip, as reported by .
The ambition shown by Harland surprised industry observers since the company ventured into an unfamiliar ferry operating domain and had previously been unsuccessful in obtaining the contract to revamp the ageing Scillonian III service connecting the Scilly Isles with the mainland.
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Newly released documents at Companies House have now confirmed that Scilly Ferries was significantly indebted to creditors totalling more than £3m at the point of its collapse. This comes on top of earlier reports exposing that the parent company, Harland & Wolff, owed a staggering sum exceeding £160m as it entered administration.
Back in May, amid postponements to Scilly Ferries highly anticipated summer inauguration, Harland & Wolff arranged for a helicopter service to mitigate inconvenience for customers left stranded by the delay, as City AM reports have indicated.
Detailed in the records is the revelation that Starspeed Limited, holding a five-year contract from 2022 to conduct air transportation between Penzance heliport and the Scilly Isles, had an outstanding claim of £71,016 against Harland at the time of its financial demise.
During that turbulent period, John Wood, the then-chief executive at Harland, disclosed in May that discussions were in progress with various local operators to forge "secure alternative arrangements" catering to those who had bookings with Scilly Ferries.
Passengers took to social media to voice their frustrations about last-minute changes and lacklustre communication regarding their planned long-distance travels, while some expressed excitement at the unexpected opportunity of a helicopter ride.
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Starspeed has remained silent, not providing any comments when approached.
The lavish spending has sparked further scrutiny over financial decisions leading up to Harland's second fall into administration within five years.
When City AM reached out for a statement, Wood implied that inquiries should be "better directed at the directors that took over the business."
He referenced his records, noting that the choice to halt [alternative] operations likely resulted in a loss of at least £6m in revenue for the initial season, discussing the ferry service.
Wood claimed that the venture was projected to reach break-even in its inaugural year and that helicopter flights were factored into the budget due to anticipated repeat business from Starspeed during the summer months, "when helicopters couldn't fly due to fog."
Amidst the turmoil and under new leadership, the company initiated an internal investigation into the mismanagement of over £25m by its previous executives, which appeared to have provided "little or no financial or corporate benefit."
According to reports from Irish News, other creditors include the Labour party and the Labour-affiliated think tank, Progressive Britain, with debts of £18,000 and £12,000 respectively.
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Over two months since entering administration, Harland & Wolff now appears to be on the brink of a rescue deal with Spanish state-owned shipbuilder Navantia, a move that could potentially safeguard around 1,000 jobs.
Harland & Wolff did not respond to a request for comment.