Q Cold, a food manufacturer and packaging firm based in Herefordshire, UK, has entered into administration, a move which is likely to result in job cuts.
The company has entered into administration following rapid deterioration in trading conditions and recent termination of a key supply contract with a major customer.
Advisory partners Chris Stirland, and Philip Watkins, and FRP Advisory director Nathan Jones have been appointed as joint administrators.
While the company continues its operations, the joint administrators are seeking a purchaser for the ongoing business. The company had a workforce of 40 when it entered into administration.
According to the administrators, due to the reduction in income, it is necessary for the company to lower operating costs and an employee consultation has been initiated, which is expected to lead to a reduction in staff numbers.
Chris Stirland said that Q Cold was a solid, profitable company that specializes in suet production alongside a packaging operation, but it had to recently bear a sharp deterioration in its trading conditions.
"The Company suffered from the recent termination of a key supply contract with a major customer which had accounted for around half of the Company's turnover. "
"The supply contract termination, together with an on-going dispute with HMRC relating to the reimbursement to the Company of overpaid VAT monies relating to that supply contract, has put a squeeze on cash flow," Stirland added.
