KPMG makes 'going concern' warning over Dawson Holdings

KPMG has said that there was 'material uncertainty' about whether Dawson Holdings would remain a going concern as the distribution company warned that its newspaper division may go into administration.

The company's chief executive, Peter Harris, will resign and be replaced by the company's finance director, Hugh Cawley.

The management reshuffle came as the company said that it's news distribution business had lost the majority of its major contracts during the first half of its financial year.

'The first half of the current financial year has been a dramatic and profoundly disappointing one for the Group, following the loss of the majority of its contracts in Dawson News,' said chairman Nigel Freer. 'This is having far reaching consequences for both our business and the industry it supplies.

In an 'emphasis of matter' statement auditor KPMG said that although a restructuring of the group has been approved, resulting in the group's bank debt being restructured, should the news division be placed into administration or default on its debt 'there is no certainty that the remaining Group will be able to successfully agree favourable terms for continuing finance within the standstill period.'

Further reading:

Dawson Holdings half-year results