KPMG adminstrators called in to collapsed paper maker

ADMINISTRATORS from KPMG have been called in to historic Fife paper maker Tullis Russell after the business collapsed with the immediate loss of 325 jobs.

Blair Nimmo and Tony Friar of KPMG were appointed joint administrators to the employee-owned company on 27 April at the request of the company’s directors
Founded in 1809, Tullis Russell produces high quality paper board for use in cards, covers and premium packaging.

In the year to 31 March 2014, the company recorded a turnover of £124.6m, but suffered a pre-tax loss of £3.4m. It has incurred cumulative losses of £18.5m over the last five years, largely as a result of weakening demand and pressure on its margins.

The company had suffered from the structural decline of its market, rising costs for raw materials, the strengthening of sterling against the euro and the loss of major customer through insolvency, KPMG said.

KPMG said that steps to “significantly reduce the company’s cost” had been taken while options to save the business are considered. A total of 325 staff lost their jobs with immediate effect while 149 staff will remain working in order to complete remaining orders.

“This is a sad day for the employees of Tullis Russell Papermakers,” said Blair Nimmo, joint administrator and head of restructuring for KPMG in Scotland.

“With trading effectively ceasing, we have had no option but to reduce the size of the workforce. We will be working with government agencies to minimise the impact on employees. We would encourage any party with an interest in acquiring all, or parts, of the business to make contact with us as soon as possible.”

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