NOTE: This statement from Caithness and Sutherland Enterprise has been issued following KPMG's announcement that Caithness white goods manufacturer Norfrost has gone into administration. A copy of the KPMG release follows, for reference.
Carroll Buxton, chief executive of Caithness and Sutherland Enterprise (CASE) said: "We are disappointed by this announcement. Norfrost is a major employer that has operated successfully producing a globally recognised product for more than 30 years.
"Our first priority is to work with the administrators to identify ways in which to secure the future of the business and employment in Caithness. We will also implement the PACE initiative to offer advice and assistance to any workers whose jobs may be affected.
"CASE has been working with Norfrost for some time in an effort to help the company meet the challenges it has been facing in an increasingly competitive international market.
"Last spring (2004) the local enterprise company provided Norfrost with a loan of £1.2 million to assist with the implementation of a new strategy to make the business more commercially competitive. That decision was based on recognition of the importance of Norfrost to the local economy, although it was recognised it carried a high element of risk.
"However, due to continuing difficult trading conditions, which are being faced by manufacturing businesses of this sort across the UK, Norfrost has been unable to achieve its forecasts and has ultimately decided to call in the administrators."
KPMG release:
Norfrost Limited in Administration
19th May 2005
Blair Nimmo and Neil Armour of KPMG Corporate Recovery were appointed joint administrators of Norfrost Limited by the Company's directors today (19th May 2005).
The business was established in 1972 and is based in Thurso. Norfrost is a white goods manufacturer and also has divisions which operate in the haulage and engineering sectors. The administrators have taken the decision to close the haulage and engineering divisions and, along with redundancies to bring the manufacturing division's workforce into line with current work levels, this has resulted in the immediate loss of 74 jobs. The company therefore now employs 87 people.
Norfrost Limited has recently experienced financial difficulties due to increased price competition from low cost economies, the rise in price of raw materials and the poor retail sector performance over the early part of 2005. Turnover for the twelve months to December 2004 was £13m.
Blair Nimmo, KPMG Head of Corporate Recovery in Scotland and Joint Administrator, said:
"Norfrost has a reputation for developing and manufacturing quality products and has a strong brand presence in its market. We are confident that we will be able to generate interest in the business.
"As always, it is regrettable that a number of redundancies have been necessary but by refocusing the company on its core business a viable entity is created.
"We are hopeful that with the support of the customers, suppliers and employees we will be able to successfully continue to trade the business as normal and quickly conclude a sale protecting as many jobs as possible."