Mountain of debt was left by bust firm
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BUSINESSES from across Badenoch and Strathspey are amongst those still owed substantial amounts of money after the previous operators of Cairngorm Mountain went bust.
More than 150 creditors have been left out of pocket by around a total of £650,000.
The saga has prompted calls for the former directors of Cairngorm Mountain Ltd to be investigated for their role in the lead up to the company going into administration.
They provided assurances the business was on a sound financial footing in their accounts signed off on September 18 last year, even though by that point there were already operational concerns about the £20 million funicular and this was not recorded in the documents.
The attraction had warned of disruptions to the running of the mountain railway earlier that month and it stopped running altogether from around the middle of the month.
The eventual closure of the mountain railway on safety grounds resulted in a 90 per cent loss in income for the operator and was the decisive factor in CML going into administration.
Nick Kempe, of Parkswatch Scotland, said: "Statements a business is a going concern are so important. They provide assurances a company's owners have the wherewithal to honour bills.
"Yet, just two months after the directors of Cairngorm Mountain Ltd signed it off as a going concern for another year, it went into administration owing money to at least 154 businesses, many of the them local.
"It's time that the four directors of CML were investigated and that the ultimate owner of the company, David Michael Gorton, who provided the assurances to the auditor was held to account."
He continued: "This follows four years during which they have been only too happy to see money taken out of Cairngorm Mountain through the large management fees paid to 'Natural Retreats' – their main money spinner – out of which the CML directors paid themselves most generously.
"This was to the tune of £300,017 in the last accounts of the UK Travel Company to 2017 shared between three directors."
Latest papers filed with Companies House last week have revealed there were no requests for a creditors' meeting.
It will now be for the administrators Campbell Dallas to distribute the proceeds from the £447,540 sale of the business to Highlands and Islands Enterprise and other assets that were owned by CML.
Just over £100,000 of that will be in fees to the administrators meaning it is highly likely not all of the creditors will be repaid in full.
A significant proportion of the debts – some £150,000 is owed to Natural Retreats-related companies – but the rest will have implications for the local economy.
Amongst local firms still owed money according to the documents are the Spey Valley Hire Centre, David Ritchie & Sons Ltd, BSW Sawmills, Colin Baxter Photography Ltd and McGowan Ltd.
Starbucks, EDF Energy and Screwfix Direct are also amongst the creditors while chartered surveyors Graham and Sibbald are still owed £126,000.
Rural Economy Secretary and Strathspey MSP Fergus Ewing said everyone is working hard to "address and mitigate the adverse impact on the local economy". He said: "We are sure the administrators will do all they can to try and ensure that creditors, particularly small local companies, are promptly paid."
Badenoch MSP Kate Forbes (SNP) said: "This shows once again how critically important Cairngorm Mountain is to the wider strath. That's also why its such a relief the resort has a future with operators that appreciate the local impact.
"I can fully understand why there will be concerns amongst local businesses as they await the outcome of this process. I regularly ask HIE for updates to ensure the local community and economy are front and centre of all decisions they make."
Regional MSP Edward Mountain (Scottish Conservatives) said: "I am hugely disappointed that businesses in the Highlands have been left out of pocket and this matter should be investigated fully.
"I strongly believe that the management structure of Cairngorm Mountain that has been used in recent years is not fit for purpose."
A spokesman for Campbell Dallas, said investigating the conduct of directors is a statutory requirement in every insolvency. He commented: "The content of the conduct return submitted to the Insolvency Service must remain confidential. As such, the joint administrators are unable to comment any further."
The Strathy tried to contact Natural Retreats but got no response. The creditor balances were obtained by the administrators from CML records and can differ from actual claims.
Related article:
Cairngorm Mountain Ltd placed in administration
