Hull-based construction firm Kingston Modular Systems has entered administration after a last-ditch rescue attempt failed.
The company, which operated from a factory and offices at Sutton Fields Industrial Estate in Hull, has been creating modular buildings and luxury park and leisure homes for a decade, serving clients in healthcare, education, and the leisure sector. However, due to cash flow problems, the company sought advice from Westgates Restructuring last month.
It has now been confirmed that the firm has ceased trading, with all 74 jobs lost, despite the directors and business advisors' efforts to secure new investment and find a buyer for the business. Frazer Ulrick, director of Westgates Restructuring, based in North Ferriby, has officially been appointed as the administrator for the business.
Mr Ulrick said the company's financial difficulties arose from a market slowdown, leading to decreased demand for its services, along with a significant bad debt still under litigation. The directors had sought investors, but called in financial experts when attempts to secure fresh capital proved unsuccessful.
Approximately 50 workers faced redundancy at the close of August, whilst the remaining workforce was retained during a marketing campaign aimed at securing new ownership, reports .
Several firms expressed initial interest, with all resources focused on finalising a deal.Nevertheless, that proposal collapsed last week, resulting in the company entering administration and the dismissal of remaining staff.
The most recent financial records for Kingston Modular Systems, for the year ending May 2024, reveal revenue declined from £17.2m to £12.6m, the firm also slid to a loss. Directors highlighted within the accounts that demand had weakened.
The accounts stated: "A decline in demand from October 2023, particularly in the leisure sector, significantly affected the business resulting in the reduction in turnover and losses for the year. The directors took action to reduce costs and secure the pipeline of new projects. Business picked up toward the year-end and into the new financial year with demand returning closer to expected levels."
Mr Ulrick said that he would typically anticipate similar businesses in the vicinity to step forward and propose a deal, but no such offers emerged.
He explained: "Initially the company sought to seek investors but that didn't succeed, and at that point I was brought in. We carried out a full marketing campaign which led to numerous interested parties coming forward. Unfortunately this only led to one bid, which then fell apart in the first week of September.
"The company went into administration on September 5, at which point I was appointed. Unfortunately the business has now closed down. It was hard - we did everything we could to try to find a buyer. but it's a sign of the market."
