SIR David Murray's Murray International Holdings (MIH) has hailed the progress of its continuing asset disposal and debt reduction plan, in spite of net debt standing at £346.7 million at the end of its latest financial year.
The metals, property and outsourcing group, chaired by the former owner of Rangers, reduced its debt pile by £23.3m in the year ended June 30,.
The year saw MIH continue to rationalise its operations by off-loading its Premier Hytemp oil and gas business in a £22m management buyout in November 2012.
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MIM said PPG, its commercial and industrial property division, raised disposal proceeds of £18.1m, compared with £164m the year before.
These included the sale of a 140,000 square foot distribution centre, occupied by Charles Tyrwhitt, for £7.6m in August and Caledonian House in Aberdeen for £7.7m in November.
Since year-end, PPG has booked a further £104.4m of disposals, including a portfolio featuring Edinburgh's Princes Mall to Catalyst Capital, and the sale of two shopping centres, in Hartlepool and Mansfield, to a pension fund. The £53.5m raised by the Hartlepool and Mansfield sales amounted to "less than half the original cost of acquisition".
The accounts were filed shortly after MIH sold the majority of its assets held by Murray Estates, its residential property arm, to Murray Capital in a £13.9m deal. The deal underlined the continuing shift of the Murray empire towards family interests, and means MIH has now off-loaded the "substantial majority" of its property interests.
Writing in the accounts, Sir David highlights MIM's latest asset disposals and debt reduction as a "significant and a very credible performance" - in spite of market conditions that "restricted realisation proceeds".
However, in notes to the financial statements, the board and shareholders reveal uncertainty over continuing bank funding and the group's liability to a staff pension and life assurance plan cast "significant doubt upon the company's ability to continue as a going concern".
The notes add: "Nevertheless, after making enquiries and considering the uncertainties described above, the directors have formed a judgement that, at the time of approval of the financial statements, the company has sufficient resources to continue to operate for the foreseeable future."
The accounts show the company had a bank loan and overdraft facility totalling £350,952,000 on June 30.
The group confirms in the accounts that talks are ongoing with the bank over the continuation of the loan and overdraft facilities while it carries out its short-to-medium-term plan of disposing assets.
Group turnover at MIH fell by a hefty £351.3m to £85.6m, which Sir David said reflected both its exit from steel beams and sections, steel plate and speciality plates in May 2012, and the sale of Premier Hytemp. He added that turnover from continuing operations had fallen for similar reasons, from £230m to £70.1m. Pre-tax losses of £24.9m, before exceptional items were recorded, compared with £30.7m in the year prior.
Sir David said the accounts include a range of exceptional items "reflecting a combination of economic factors, market forces and the impact of the group's asset disposal and debt reduction strategy."
He explained: "In particular, £108m of non-cash property impairments have been booked in recognition of continuing valuation and market challenges in relation to the portfolio in PPG and Murray Estates. A loss of £9.8m was also suffered on the sale of Premier Hytemp."
The latest round of disposals leave the trading activities of MIH restricted to Response, its call centre division, and Ireland Alloys, which acquires, sorts, processes and sells complex allows, notably nickel.
MIH said it was reviewing the strategic options for both Response and Ireland Alloys.