Quinn restructuring not affected by family action

THE QUINN Group has received legal advice that the case being taken against it by its former owners, the Quinn family, does not affect the restructuring of its enormous debts.

The 2009 accounts for the group’s holding company, Quinn Group (ROI) Ltd, have just been filed and show a consolidated pre-tax loss of €851.8 million. The previous year the company reported a consolidated pre-tax profit of €83.4 million.

The total recognised losses for the 2009 year were €945 million.

In April of this year the Irish Bank Resolution Corporation (formerly Anglo Irish Bank), appointed a share receiver to the company and Seán Quinn and other members of the board were replaced.

The restructuring of the group was formally completed earlier this month by IRBC and other creditors, who between them now own the group.

Quinn Insurance Ltd, formerly part of the group, was put into administration in March 2010 and is no longer part of the group.

The 2009 accounts show a range of impairments on the group’s activities totalling €291 million. A provision of an additional €63 million was made against loans due from companies controlled by the Quinn family, bringing the total provision in that regard to €951 million.

The notes to the accounts say that because of the difficult trading conditions that existed during 2010, an impairment of approximately €225 million will be recognised in the accounts for that year.

Among the assets that have been impaired is a chemical plant under construction in Germany. The group is in search of funding to complete the plant and, the accounts state, if no funding is found, a further impairment will be triggered. The impairment for 2009 was €81.5 million.

The impairment on the plastics division was €33.8 million while the goodwill impairment in the construction division was €41 million.

The value of the group’s 24 per cent ownership of Neontar, which owns the NCB group, was written down by €7.3 million, to €3.6 million. Other impairments totalled €50.3 million.

The group continues to employ a significant number of people. The average number of employees in 2009 was 6,125, down from 6,860 the previous year. Total staff costs were €211.8 million.

Directors’ emoluments during the year were €2.6 million, up from €1.5 million the previous year. The highest paid director received €1.2 million. Charitable donations were €212,000.

Share receiver Kieran Wallace was appointed to the group in April of this year. In May a legal action was initiated by the family which, among other matters, seeks to overturn the appointment of Mr Wallace.

In their report accompanying the Quinn Group (ROI) accounts the directors say they are “satisfied based on legal advice that the commencement of these proceedings does not affect the restructuring of the group’s financial indebtedness or the viability of the business”.