Kingston Modular Systems has traded for 10 years but is now in the hands of administrators
A Hull construction company has fallen into administration with all jobs lost after a last-minute bid to save it collapsed.
Kingston Modular Systems, which has a factory and offices at Sutton Fields Industrial Estate in Hull, has been designing and making modular buildings and luxury park and leisure homes for 10 years, with customers in healthcare, education as well as the leisure sector. However, the company last month brought in business advisors from Westgates Restructuring after coming up against cash flow issues.
Now it has been confirmed that Kingston Modular Systems has ceased trading with all 74 jobs lost, despite efforts by the directors and business advisors to seek out fresh investment and to find a buyer for the business. Frazer Ulrick, director of Westgates Restructuring, based in North Ferriby, has now officially been appointed as administrator for the business.
He said the company’s money woes stemmed from a slowdown in the market which has seen demand for its services fall, coupled with a large bad debt that is still in litigation. The directors had looked to find investors, but enlisted the financial experts when attempts to find fresh capital failed to come to fruition.
Around 50 employees were made redundant at the end of August, and the rest of the staff were kept on while a marketing exercise was carried out in a bid to root out new owners. A number of companies showed early interest, and all efforts were placed on then getting on offer over the line.
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However, that offer fell apart last week, after which the firm was placed into administration and the remaining employees were made redundant. Most recent accounts for Kingston Modular Systems, covering the year ended May 2024, show how turnover fell from £17.2m to £12.6m, while also tumbling into the red. The previous year’s profit of £106,565 was turned into a loss of £563,429.
At the time, the firm had 87 employees – a figure which fell to 74 by the time the firm collapsed. Within the accounts, directors told how there had been a drop in demand.
In the accounts report they said: “A decline in demand from October 2023, particularly in the leisure sector, significantly affected the business resulting in the reduction in turnover and losses for the year. The directors took action to reduce costs and secure the pipeline of new projects. Business picked up toward the year-end and into the new financial year with demand returning closer to expected levels.”
Mr Ulrick said he would normally have expected similar businesses in the area to come forward and seek a deal, but nothing materialised, ultimately leading to the business ceasing trading.
He said: “Initially the company sought to seek investors but that didn’t succeed, and at that point I was brought in. We carried out a full marketing campaign which led to numerous interested parties coming forward. Unfortunately this only led to one bid, which then fell apart in the first week of September.
“The company went into administration on September 5, at which point I was appointed. Unfortunately the business has now closed down. It was hard – we did everything we could to try to find a buyer. but it’s a sign of the market.”
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