McInerney posts €10.9m loss as it seeks court protection
Construction firm McInerney, which last week applied to the High Court to have an interim examiner appointed to its Irish home-building unit, posted a pre-exceptional loss of €10.9m in the six months to the end of June, smaller than the €12.8m loss it recorded in the corresponding period a year earlier.
The struggling company, which has been attempting to restructure its finances amid the downturn, has debts of €242m, with about €111m of that earmarked for transfer to the National Asset Management Agency. Its bankers have withdrawn support for McInerney's Irish business.
Releasing results yesterday, the company said it incurred an exceptional charge of €5.9m during the first half of 2010, of which €4.5m related to the write-off of its investment in its Spanish freehold apartment development division, Alanda Homes.
The remainder related to costs associated with the proposed restructuring of the group's debts. McInerney engaged Goldman Sachs last March to advise it on that restructuring process. McInerney incurred a €156m impairment last year as it wrote down the value of its land holdings.
The group completed 200 homes in the UK during the first half of the year, half of them social housing, and 49 units in Ireland.
That compared to 274 and 64 respectively during the first half of 2009. The home-building business in Ireland recorded a €2.3m loss in the first half, while, in the UK, it made an operating loss of €1.25m compared to a loss of €2.9m in the first six months of 2010.
Its average home sale price in Ireland, excluding VAT, was €195,000 in the first half, compared to €228,000 a year earlier. The company owns or controls 5,800 plots in the UK and Ireland, most of which have planning permission.
A decision regarding the appointment of the interim examiner is due to be made by the court next Tuesday. US private equity house Oaktree Capital has been considering an investment in the Irish group.
McInerney chairman Ned Sullivan said the focus remained on achieving a stable funding platform for the group, providing the working capital necessary to build and sell homes.
"The loss of the support of the syndicate lenders in Ireland was unexpected and caused us to seek court protections for the business," he said in a statement. "But progress has been made on the restructuring."
Trading in the company's shares was suspended last week.