ALMOST 90 workers at the Silver Pail Dairy ice-cream business in Fermoy, Co Cork are facing an uncertain Christmas after an interim examiner was appointed to the struggling business today.
t’s been hit by soaring input costs, including higher prices for milk, cream and energy. That’s created a cash crunch for the firm.
However, it’s understood that there will be strong investor interest in the venture, which holds a number of significant contracts with major retailer such as Tesco, Dunnes Stores and Musgrave, the company that controls the SuperValu multiple.
Family-owned Silver Pail Dairy was established more than 40 years ago. It is headed by managing director Thea Murphy, daughter of founder Michael Murphy.
Staff were informed this afternoon of its difficulties.
It’s believed the company generates annual turnover of about €23m, and while it had made a loss this year and last year, it’s thought to have been in the black on an earnings before interest, tax, depreciation and amortisation (EBITDA) basis.
However, it’s believed to be carrying about €4m of bank debt, with other creditors owed up to €7m.
The firm’s banker is AIB.
Shane McCarthy of KPMG has been appointed interim examiner to the firm. His formal appointment as examiner is expected to be approved by the High Court in early January.
Only last year, Silver Pail secured a €1.4m contract with Tesco to supply the retailer with own-brand ice-cream. The Cork company also makes frozen desserts, frozen yoghurt, and sorbets. It’s thought that its clients also include the Irish arm of US ice-cream chain Baskin Robbins, which has outlets in Ireland and the UK.
The Co Cork business started out making softwhip ice-cream for cones and later developed its product base.
The company behind the manufacturer – Silverpail Dairy – is unlimited, and so does not have to file publicly-available accounts, shielding its financial performance from the public.
It’s thought that the factory could offer significant synergies to other ice-cream manufacturers. While the Murphy family is hopeful that they could continue to be involved in the business, the company’s future will now rest entirely with the examiner and its creditors and potential investors.
Business lobby group Ibec warned this week that more Irish businesses face failure due to soaring energy costs and urged the government to beef up supports.
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