No Christmas cheer for 72 Tomlinson’s and Sainsbury’s farmers

PWC the administrators for the collapsed Tomlinson’s Dairies Limited have issued their proposals and its very depressing reading.

The key points are that the 72 farmers (Tomlinson’s directs plus Sainsbury’s group) are unlikely to receive any payment from the administration. HSBC are owed £15.6 million and this is unlikely to be fully repaid with finance Wales Investments highly likely to join the farmers for a nil payout on the £1.8m it is owed.

Officially the report states that unsecured creditors will receive between 0p to 3p in the £1.

There are 11 finance agreements in the queue for payment.

Of the other creditors the notable ones are:

Milk Supplied by 72 farmers  - £3.3m (43 days milk)
Arla Foods - £1.66m
Kite Consultancy - £37k
OMSCo - £89k
Lloyd Fraser Haulage - £438k
Willis Haulage - £118k

PWC have had interest from 58 potential buyers for the assets but none have resulted in an acceptable bid hence the assets will be broken up presumably by Auction in the New Year.

Tomlinson’s are undoubtedly another Sainsbury’s casualty having folded after only 2 years of a 3 year Sainsbury’s contract. Its history requires no detailed analysis.

2016     £1.6m profit
2017     £1.7m profit - on a £50 million turnover with 100 million litres
2018     £4.3m loss - Sainsbury’s 3 year contract commenced processing 200 million litres.
2019     £2.7m loss

Curiously Sainsbury’s have lodged “a significant counterclaim” on October 10th but no one has further details as to what this claim relates to. A smart guess would be it relates to the interest free loans JS have arranged via Muller to the affected farmers.