€13m written off value of kitchen firm
CORK-based Cash & Carry Kitchens continued to suffer last year as €13m was written off the value of the business.
Accounts for Cash & Carry Kitchen's immediate patent company – ORM – show that while the business made an operating profit of €544,000 last year, down from €849,000 a year earlier, a massive €19.2m impairment on an intercompany loan propelled it to a €19.6m loss.
Owned by Eamonn O'Rourke, accounts for ORM reveal the depth of the downturn's impact on the Cash & Carry Kitchens business.
ORM is in turn controlled by a firm owned by Mr O'Rourke called AFA Investments.
"In order to recognise the current difficulties in the economy, the directors of AFA Investments have written down the value of its investment in its subsidiary ORM by €12.9m, €12m and €10m in 2011, 2010 and 2009 respectfully," the accounts note.
"Arising from same, the directors of ORM have included an impairment charge amounting to €19.2m . . . to recognise that the amount due from AFA Investments may not be recoverable in full, based upon the valuation currently placed by AFA Investments on its stake in ORM."
The accounts also show that the number of people employed at the business fell to just 21 last year from 34 a year earlier.
The impairment shouldered by ORM last year brought its shareholder funds down to €7.1m from €26.8m a year earlier.
Auditors for AFA Investments note in the latest set of accounts for the company that the firm is reliant on the continued availability of financial facilities from its bankers and directors/connected companies to enable it to continue as a going concern.
"The financial statements are prepared on the going concern basis, the validity of which depends on sufficient funding being available," the auditors note.