Orla Kiely fashion empire folded with more than £7m debts: report
The Orla Kiely fashion retail empire went out of business with debts of more than £7.25m, new documentation shows.
That is according to the joint administrators of the collapsed retail business who anticipate that unsecured creditors owed £5m will be left empty-handed from the administration.
The administrators Chris Newell and Simon Bonney estimated that the total deficiency from the business amounts to £7.5m.
Ms Kiely's fashion empire had been helped in no small way by the Duchess of Cambridge, Kate Middleton, who has worn her distinctive print coats on a number of occasions.
Other celebrity fans of the Orla Kiely brand included Girls creator, author and actress Lena Dunham, and actresses Keira Knightley, Kirsten Dunst and Zooey Deschanel.
However, in September, the announcement that Ms Kiely's retail business had shut down with the loss of 48 jobs in the UK and in Ireland sent shockwaves across the fashion and retail worlds.
The most recent accounts for the 12 months to the end of March 2017 showed that the business had recorded earnings of £322,551 as revenues climbed by 16% to £8.3m.
Now, a 60-page report by the administrators lodged with Companies House sheds some light on how the fashion retail empire collapsed.
In the report, the administrators stated that from 2000 the business traded profitably with many years of success with a strong brand.
They said that "the company began to experience difficulties and, as a result, the profitability of the business began to suffer. This is in part due to the downturn in the fortunes of retail customers in the current trading conditions".
The administrators also reveal that a new finance director was appointed to the firm in July 2018 "following which a number of issues were highlighted with the company's finances".
The administrators said that as a result, Orla Kiely and her husband Dermott Rowan sought advice from an insolvency practitioner, who advised that the business be closed down and the company placed into creditors' voluntary liquidation.
The administrators stated that upon receipt of the notice of creditors' voluntary liquidation, the company's largest creditor - Metro Bank plc, owed £2.2m through fixed and floating charges - placed the company into administration.
The list of unsecured creditors show that £2m is owed to 'trade and expense creditors' with £1m owed to Ms Kiely and Mr Rowan.
In addition, the Irish Revenue are owed an estimated £100,000 and HMRC owed £567,702.
The estimated amount owed to employees and former employees is £315,243.