The Llangollen Railway PLC directors have invited the bank to appoint receivers after accounts have shown losses in recent years.
The company accounts show the PLC made losses of £330,601 in 2018, £329,175 in 2019 and £258,804 in 2020.
In a press release made public today, the Llangollen Railway PLC said “A number of significant engineering contract disputes, all of which arose in the years prior to the current board taking over in October 2020, have crystallised in the last few days. The claims against the company are compelling and are in excess of £250,000 in total. There is no prospect of meeting these liabilities, even over an extended period.”
The balance sheet is now insolvent to the extent of £350,000.
Continuing, the Llangollen Railway PLC said “The directors would like to acknowledge the considerable support of the Welsh Government through two significant grants, and NatWest Bank which, together with furlough payments, have enabled the company to continue to meet its commitments over recent months until now.”
Meanwhile, the Llangollen Railway Trust's balance sheet is solvent and there is some cash in hand. The Llangollen Railway Trust will work with the receiver and hope to secure the line, rolling stock and infrastructure.
They are hoping to recommence operations in due course, following the necessary approvals, which may take some time.
Full details can be found below in the full announcement made today by the Llangollen Railway website.
It is with great regret the directors of Llangollen Railway PLC have had to take the reluctant step of inviting the bank to appoint a receiver.
The company's accounts show pre-tax losses of £330,601 in 2018, £329,175 in 2019 and £258,804 in 2020 (pre-audit). A number of significant engineering contract disputes, all of which arose in the years prior to the current board taking over in October 2020, have crystallised in the last few days. The claims against the company are compelling and are in excess of £250,000 in total. There is no prospect of meeting these liabilities, even over an extended period.
As a result the balance sheet is now insolvent to the extent of £350,000 approximately, adjusting for intangible assets also. In such circumstances the company cannot legally continue to trade.
The directors would like to acknowledge the considerable support of the Welsh Government through two significant grants, and NatWest Bank which, together with furlough payments, have enabled the company to continue to meet its commitments over recent months until now.
The Trust's balance sheet remains solvent and there is some cash in hand. The Trust board will need to take steps to negotiate with the receiver to try to secure the line and preserve rolling stock and infrastructure to the extent possible. It is intended to recommence operations in due course but this is dependent upon legal and regulatory approvals, including licencing, all of which will clearly take time.
The directors very much regret the impact this will have on our staff and employees, customers, suppliers, locomotive owners and their organisations, and anyone else with connections to the Railway. It is hoped to rehire many of our staff and employees and that it will be possible to maintain connections with many longstanding friends.
Customers who have purchased tickets in advance, including driver experiences, deposits for weddings and gift vouchers, will either be refunded (the monies have been reserved) or will hopefully be able to travel at a future date.
Where shareholders have ongoing annual ticket entitlements, these will continue to be met through the Trust.
Anyone wishing to make a claim in the receivership should contact the Railway by e-mail at commercial@llangollen-railway.co.uk and details will be passed to the receiver.
Anyone wishing to contact the Trust, please do so at the above e-mail address also.
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I still hope this Lovely Scenic & Well-Preserved Heritage Railway still has A Bright & Colourful Future Ahead.
I’d still look forward to visiting & ride aboard a train ride up & down the Distinctive Dee Valley of the River Dee ‘in-person’ someday…
My heart still goes out to them, especially the folks & locals of each location up the Valley of whom the Llangollen (& Corwen) Railway Roams, Passes & Serves through & through.
Very sad for a line I love and have many years of pleasure of visiting. I just hope the situation can be resolved and this line can return to providing the wonderful service it does. Perhaps the Welsh government can help it become a preserve and public service. The area needs good public transport, and that would help the preserved traffic.
At least the PLC is the part that has gone under as, unless I’m wrong, the line itself and the assets are owned by the Trust. They’ll need a new operating company, but the line itself ought to be safe.
It’s been coming since way before COVID, though, as the extension had pretty-much crippled the finances of the company. The Dee bridge, and then COVID, simple knocked those final nails in. A timely reminder to all lines about the importance of not letting your heart rule your head.
I do hope the directors past and present have liability insurance if not they may well face large claims. As to running trains it will depend on who`s name the TWA or LRO is in.
the Numonic Plague strikes yet again…More will follow because of it…
More the combination of COVID arriving at a time when the line was already in financial trouble due to the extension, coupled to the Dee bridge project. Without the extension and the bridge, they could probably have ridden it out – but as they were already in poor shape they had a harder job on their hands.
You may be right. I could certainly see the West Somerset and the Bure Valley as likely to follow unless things improve soon.
This is distressing news to hear today. It was always my dream to reopen this line and I helped bring back the very first piece of track from Cortaulds in Flint during the early 70’s. I hope something can be done to save this beautiful line.
The sad news of Llangollen Railway has just reached me, I am very distressed to hear such bad news and I sincerely hope a quick solution can be resolved.
This could be a disaster to the region especially at this time towards the end of Covid.
I am retired but during my life have travelled this line before it first closed and have over the years taken my family on this line innumerable times needless to say that I am a lifetime railway enthusiast.
My concern at this time is the devistating effect this could have on the whole region.