Operating from bases in London, New Malden, Corby, Manchester, Newcastle and Paris, the three companies had made their names specializing in the supply of lighting and sound equipment to the entertainment and leisure industries. Whilst Lighting Technology and Cerebrum concentrated on the distribution of a large portfolio of brand names, Lighting Technology Projects focused on installation, specializing in high profile architectural projects. It should be emphasized that the Paris operation is not in administration and operates as a stand-alone business which continues to trade profitably.
As recently as three years ago, the Group was picking up some of the biggest lighting contracts in the UK: in 1999, it won its biggest ever stage lighting order when it was awarded the £470,000 contract to supply London’s re-built Royal Opera House. At the same time, Lighting Technology Projects, and its subsidiary The Technical Department, were working as a main lighting contractor for the Zones at the Millennium Dome. This trend of high profile projects continued and in the last 18 months included work on the Theatre Royal, Newcastle; Magna in Rotherham; the Gateshead Millennium Bridge and Hull’s new visitor attraction, The Deep.
However, despite the apparently healthy order book, and a Group turnover of £14.8 million in 2001, it was not enough to protect it against the significant losses it reported in 2000. These losses came principally from two sources - the failed joint venture with MAD Lighting which unravelled in spring 2001 and financial losses attached to the Dome contract. Having been encouraged to bypass the paperwork and throw resources at the Dome in the last-minute rush to ensure it opened on time, they then found that the new management, brought in after the Dome’s opening, refused to pay invoices that didn’t have the requisite purchase order attached, leaving the Group heavily out of pocket.
These frustrating episodes were matched by a steady exodus of high profile members of staff. Paul de Ville left in the summer of 2000 to join Lightfactor; he was followed in May 2001 by managing director Alan Hewitt, who took early retirement, leaving Lighting Technology’s founder David Morgan to resume the role of MD.
In recent months, the pace of departure had accelerated - export sales manager Ron Knell transferred to A.C. Lighting, whilst group marketing manager David Cartwright, now with MGC Lamps, was one of the casualties of a round of redundancies in late 2001.
The Group had been doing everything it could to rationalise its cost base: it had undertaken a number of restructuring exercises and had also recently reintegrated the separate Projects team back into its London Park Royal HQ. It had also invested heavily in a centralised distribution centre and stock management system at its Corby facility, but was unable to alleviate the cashflow pressures that had already emerged.
David Langton of PWC is hoping to keep the Group going: "It has an excellent reputation and a good customer base. It has been very profitable until the last couple of years, and we will be trying to find a buyer for the business as a going concern."
(Ruth Rossington)
