Safestyle UK collapse: Union blames 'mismanagement' while administrators cite 'unseasonally warm September'

The company, which also had a manufacturing centre in Barnsley, was placed into administration yesterday after it announced on Friday night that it was no longer able to trade as a going concern following prospective buyers withdrawing their interest.

It follows the company recently reporting a £6m loss before taxation for the first half of 2023. Revenues for the six-month period had been £74.1m, down from £78.3m in the same period in 2022, when a £1.4m loss was recorded.

CEO Rob Neale said on September 27 that there had been “continued economic uncertainty and depressed consumer confidence” but added that he was “confident that the business is well-positioned to deliver a strong recovery when macro conditions improve”.

However, on Friday morning the company announced it was suspending trading in its shares following a failure to secure a sale.

Lee Parkinson, organiser for the GMB union, said: "Safestyle UK workers have been completely let down by mismanagement from the very top of the business.

"More than 600 workers have been cruelly cut off from work, weeks before Christmas, with no guarantee that they will even get last week's pay-check.

“The impact of this closure upon the community of Barnsley cannot be overstated. It is simply devastating. We need urgent answers on where the money has gone."

Administrators Interpath were contacted by The Yorkshire Post for a Safestyle response to Mr Parkinson’s remarks and referred back to a statement announcing the start of the administration process.

In it, factors including an “unseasonally warm September” were cited as factors in the company’s problems.

It said: “In common with a number of companies across the home improvement sector, Safestyle UK has had to navigate a number of pressures which have impacted trading, including high cost inflation, ongoing economic uncertainty and fragile consumer confidence.

"In recent months, these pressures have been exacerbated by an unseasonally warm September, which has dampened customer demand.

“In response to these challenges, the Group engaged with stakeholders to explore a range of options to help strengthen its balance sheet, including a capital injection or new financing, a potential sale of the shares in the subsidiaries and/or a sale of the business and assets of the subsidiaries.

"Unfortunately, despite interest being shown by a number of parties, a solvent solution was unable to be found, and the directors took the difficult decision to seek the appointment of administrators.”