Sandyford firm 'uncertain' about surviving
Published 13/08/2010 | 05:00
A DAVID Arnold-backed company behind a major Sandyford development has admitted there is a "material uncertainty" over its ability to survive the property crash.
Furze Road Development, which includes Mr Arnold and five other investors, spent about €8m on a site near Sandyford's Beacon district in Dublin in 2005.
The firm later unveiled plans for the €25m 'Q House' office development which launched in April 2008 and now has more than 40 occupants.
The latest accounts for Furze Road Development, however, show it racked up losses of almost €865,000 in the year to June 2009, leaving it with a €900,000 shareholders' deficit.
Noting the year's results and balance sheet position, the directors of Furze Road Development said the outlook presented "significant challenges in terms of sales".
"Whilst directors have instituted measures to preserve cash and restructure financing facilities, these circumstances create material uncertainties over future trading results and cash flows," they added.
"The directors have concluded that the combination of these circumstances represent a material uncertainty that casts doubt upon the company's ability to continue as a going concern."
Auditors for Furze Road Development noted the same "material uncertainty" over the firm's ability to continue trading as they placed an "emphasis of matter" on its accounts.
Despite those notes, however, the directors said they had a "reasonable expectation" that Furze Road Development had "adequate resources to continue in operational existence for the foreseeable future".
The 2009 accounts show sales of €12.7m for the year, down on €15.5m the previous year, with work in progress valued at €7.4m on the balance sheet at year-end.
Some €7.4m was owed to the company's bankers at the end of the year, down from €22.8m a year earlier. The accounts noted that the loans to Irish Nationwide were backed by "fixed and floating charges" over the building licence agreement and work in progress.
The bank also holds personal guarantees from each of the directors -- Mr Arnold, John Lombard, Mark O'Brien, Michael McCarthy, Robert McCarthy and Stephen McCarthy.
According to the latest filings, Mr Arnold, Mr Lombard and Mr O'Brien each hold 20pc of the development, while the remaining 40pc is split equally between the McCarthys.