OFFICIAL documents filed by the Cleveland Bridge administrators show that the company's debts total more than £21million.

The astonishing amount is made up of 264 separate entries in the Company's House documents, including £6million to the Arab National Bank, £3million to HMRC and £2million to UK Export Finance. 4Syte -  who provided the company with a funding line of £4m - is still owed £2.24 million.

It comes as The Northern Echo first revealed the decades-old Darlington firm faced collapse earlier this year.

The Northern Echo:

The company's owner, ARPIC, a Saudi Arabian based Oil and Gas conglomerate owned by Sheikh AI-Rushaid with his son and namesake is a director will be owed around £8 million, but the administrators say:  "Based on the funds likely to be available, it is anticipated that ARPIC will suffer a shortfall."

The Northern Echo: Public documents show the amount owed Public documents show the amount owed

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The main reasons that sent the firm hurtling into the red were listed as:

  • Significant delay in project start dates due largely to the pandemic, which cost £1.7m. Volumes of low margin work was not sufficient to cover overheads.
  • The need for overtime working and agency staff as the delayed contracts all recommenced in and around the same time following lockdown had a negative impact on margins.
  • Exceptional costs in 2020 of £1.7m which largely relate to the impact of the pandemic.
  • Delay in the commencement of a significant high margin overseas contract due to a political coup in Sri Lanka.
  • An estimation error on one contract resulted in a project achieving a zero gross profit. This contract is understood to have made up the majority of production hours in Ql 2021;
  • Significant increase in steel price this year which could not be passed onto customers on all contracts;
  • Credit limits with suppliers (with credit insurance) were reduced due to the poor trading results for 2020 placing more pressure on working capital.
  • An inability to raise adequate additional working capital.

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It was also revealed that the alarm bells started ringing in January, when  Martyn Pullin of FRP was approached by Financial Director Phil Heathcock as the Company said it  needed a cash injection to meet its obligations in the latter part of 2021.

The report says at that stage "the Board were confident that the Company would be able to raise sufficient funds either from a funder or via ARPIC."

In June, the Company engaged a team from turnaround specialists, Kingsgate who also  "understood that the Company's refinance would provide a sound financial footing to allow a turnaround plan to be implemented."

But they soon discovered the Company had a working capital shortfall "as a consequence of under-delivery on revenue" and needed an additional immediate injection of  around £12 million  to fund the business until the end of the year.

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But by July there was still no money and Heathcock told the administrators that ARPIC had declined to provide any further financial support and Cleveland Bridge would be unable to pay wages the following week.

The documents explain: "As the Company was cash flow and balance sheet insolvent, and reliant upon the financial support of ARPIC, a decision was made to approach ARPIC for a final time to request funding to avoid Administration.

"The funding was not provided and the Company entered into consultation with the whole of its workforce on 20 July 2021 confirming that all jobs were at risk."