Cost inflation was the cause of last week’s fall into administration of offsite building firm Caledonian Modular.
The company, which despite its name has its head office and factory near Newark in the Midlands, has an annual turnover of £45.3m.
Caledonian Modular made a £2.8m pretax loss in the 12 months to 31 March 2020, but at the time its most recent full-year results were published, it said it expected stronger trading following the pandemic.
However, a source close to the business said it had subsequently struggled with a combination of increasing raw materials and staff costs.
Together, the inflation further impacted its profitability to the point where directors had to call in administrators Alvarez & Marsal.
In a statement, Alvarez & Marsal said: “Mark Firmin and Mike Denny of Alvarez & Marsal were appointed as joint administrators of Caledonian Modular Limited on 8 March 2022. The administrators are continuing to trade the business while exploring all possible options for its future, including finding a new buyer.
“Regrettably, 28 employees – around 10% of the total workforce – have been made redundant as part of the administration process. Every effort will be made to support them during this difficult time.”
