Newcastle-based Howard Russell Construction owed suppliers and trade subcontractors almost £4.6m when it collapsed last month.
The company, which mainly built industrial warehouses and manufacturing facilities, went into administration at the beginning of May.
A report by administrators FRP Advisory has revealed it owed £4.58m to unsecured trade creditors, including M&C Roofing Contractors, also based in Newcastle, which is claiming £759,000.
In total, 208 creditors were listed in the report, with debts totaling just over £9m.
FRP Advisory said it thought there will be enough funds to make a distribution to unsecured creditors, although the amount will not be known until after the company is liquidated.
In the year to March 2022, Howard Russell made a pre-tax profit of £790,000 on turnover of £43.6m and expected to post revenues of between £60m and £70m l next year
However, according to the administrators’ report, the profitability of their contracts was greatly affected by the impact of Covid, Brexit and increased material costs.
There were also “significant delays” in some construction contracts, which subsequently incurred large penalties that greatly affected the profitability of those contracts, the report said.
In addition, Howard Russell was hit by defects liability claims and claims against claims made on larger completed contracts which dealt a major blow to the company’s solvency.
“The principals tried to implement various change strategies; however, all attempts were unsuccessful,” the report concludes.
The company is one of a number of North East contractors to go under so far this year, with Tolent, Metnor and Norstead ceasing to trade.
