[Football] Carillion on the brink ?

[Pavilionaire]

Do us all a favour, your like that drunk bloke that walks into the kebab shop at 2am wanting to start a fight.

If you bothered to look there seems some posters that have some real experience of many aspects of the financing and even specifically Carrilion itself, if you genuinely cared perhaps you would read and try to analyse what is being said before apportioning blame, today started with the usual sneer from [MENTION=409]Herr Tubthumper[/MENTION] and you could nearly sense his delight at this companies demise, then came the usual anti PFI and anti bankers and anti shareholders anti anything that they deem as capitalism, until much of that was quickly poo pooed

I am not saying it doesn't warrant investigation or that individuals should not be held to account politicians too, but give it a break on blaming absolutely everything on Brexit, apart from the successes of course you could always give that a go just for balance.

It's not my words about Brexit - it's the Carillion directors themselves. Daily Telegraph, 07 Dec 16:

"Carillion, which maintains railways, roads and military bases, has said the pace of work has slowed in the second half of the year, partly because of a pause in work from the UK Government following the EU referendum in June.

The company said this morning that it did not expect to repeat its performance in the first half, when it signed £2.5bn worth of new contracts, because Government departments have “reassessed their spending priorities” since the vote and ahead of last month’s Autumn Statement."

I've done my reading on this subject and I'm not blaming everything on Brexit but it stands to reason that if you are preparing for Brexit AND running the country then something has to give - there are only so many hours in the day. I fully expect ministers to be rubber stamping stuff without due diligence, as Chris Grayling appears to have done in this case.

 

[Simster]

Thanks for your remarks about grammar, always a good start from you lot and then adds the jibe pompous towards me in the same sentence, righto.

The rest is renationalisation, not for me thank you.

Although you and me live in the same part of the world probably experience similar stuff, my feelings aren't that there is immediate failings in everything I see or use.

My family have been treated wonderfully by the NHS regularly throughout our lives, my children had good educations, I love the current bus service and the rare times I use the trains it is nearly luxury the stuff that the government are meant to deliver tend to do it quite well, whereas you seem to think it is not fit for purpose.

You see, I prefer your posts when you're actually talking about the matter in hand -
no need to talk to Chappers or Pavilionnaire as you did, frankly.

Anyway, anecdotally, my experience of the NHS is that it is a lottery depending on when and where you are - the service seems to range from outstanding to utterly dire in a way that you don't see in a competitive market. Similarly, I think education depends on the school, as we are still in a situation where parents avoid the bad ones. Mine have been pretty good though.

But your comments on "public" transport are miles wide of the mark. If you lived in mid-Sussex (barely a few miles from Brighton), you'd know how feeble it was. As for the trains, they are shocking. An absolute disgrace. If they weren't, there wouldn't be pages of discussion on here about them.

 

[Herr Tubthumper]

the rare times I use the trains it is nearly luxury

This confirms it. You are mad.

 

[Beach Hut]

As I have said, the government have their eye well off the ball with domestic issues

Yep all their fault, nothing to with the fact Blair maxed out on this when in power

 

[BigGully]

You see, I prefer your posts when you're actually talking about the matter in hand -
no need to talk to Chappers or Pavilionnaire as you did, frankly.

Anyway, anecdotally, my experience of the NHS is that it is a lottery depending on when and where you are - the service seems to range from outstanding to utterly dire in a way that you don't see in a competitive market. Similarly, I think education depends on the school, as we are still in a situation where parents avoid the bad ones. Mine have been pretty good though.

But your comments on "public" transport are miles wide of the mark. If you lived in mid-Sussex (barely a few miles from Brighton), you'd know how feeble it was. As for the trains, they are shocking. An absolute disgrace. If they weren't, there wouldn't be pages of discussion on here about them.

As far as the trains are concerned, I did say I dont use them and the rare time I have they have been extremely good but I am aware that I just haven't use them enough to offer a general view, but from afar Southern Rail hasnt been great but I doubt the unions are blameless either, I just dont think renationalisation would be preferable, for the record having lived and worked in Germany I always found their rolling stock less modern than ours and never as slick as we might be lead to believe, although something quite atmospheric about German trains for some reason.

My comments towards your colleagues are not driven by some keyboard hatred for them personally but it seems a pointless exercise to just post up a daily financial indicators and lump that down with Brexit all the time, its quite clear that what you all have said would happen hasn't really materialised, I suspect it really wont, so this will need to be revisited some time later.

I think [MENTION=409]Herr Tubthumper[/MENTION] deserved some challenge from me, [MENTION=258]Pavilionaire[/MENTION] was no more than a response from me to his post at a time I felt the thread had something worth reading whilst I mis-read [MENTION=13]CHAPPERS[/MENTION] as I wasn't expecting such a conciliatory response to perhaps a tetchy post from me, so fair play and I apologise.

Anyway pick the bones out of that and onwards and upwards, I apologise in advance for my grammar !!

 

[Lyndhurst 14]

One of the on line construction trade papers is saying that Carillion is holding more than £800M in retention payments against its sub-contractors. This is money that is withheld contractually against its sub-contractors and, normally, is paid once the sub-contractors have met their contractual obligations. The risk now is that these payments will be delayed or not even made pushing more sub-contractors into liquidation. It also says another two major UK contractors, Balfour Beatty and Galliford Try, face potential losses of £45M and £80M respectively on joint ventures with Carillion. The ripple effect of this collapse will go on for a long time.

 

[Gritt23]

One of the on line construction trade papers is saying that Carillion is holding more than £800M in retention payments against its sub-contractors. This is money that is withheld contractually against its sub-contractors and, normally, is paid once the sub-contractors have met their contractual obligations. The risk now is that these payments will be delayed or not even made pushing more sub-contractors into liquidation. It also says another two major UK contractors, Balfour Beatty and Galliford Try, face potential losses of £45M and £80M respectively on joint ventures with Carillion. The ripple effect of this collapse will go on for a long time.

That is not unusual, or indeed a surprising figure given the scale of their workload.

Just to elaborate on how retention works in the industry. As a sub-contractor, I will put in an application for the value of my work on a monthly basis (or whatever terms are agreed), and the Main Contractor (Carillion) will value that work, certify it and pay it. BUT there will be a Retention element held back, as you say, but those "contractual obligations" run for longer than you may realise. Typically, 5% Retention is held throughout the job, with half of that being release at "Practical Completion" of either your element of the work, if you are say a groundworker, or typically when the building itself reaches practical completion if you are a finishing trade. But the second half of your retention will be held for either 12 or 24 months to cover for latent defects. So, basically, the Main Contractor holds 2.5% of your money in case things go wrong after you've finished. You should get the opportunity to return and put those defects right at your cost, but failing that - if you just refuse, or cannot be contacted - then the Main Contractor will deduct the cost of the rectification works from your Retention.

In turn, I would expect a pretty hefty line in Carillions debtors to be Retentions owed to them from their clients. And there are just two hopes of the liquidators seeing that money, Bob Hope and No Hope. The clients will offset a multitude of disruption costs against the outstanding monies owed to Carillion that will in most cases extinguish the value completely.

As you say, the ripple effects of this will spread far and wide. A lot of people will have lost a lot of money with Carillion going down.

 

[Pavilionaire]

Beautiful irony - Government ministers, fearing work halting on HS2, have ordered a fast-track investigation into directors at the failed construction firm Carillion.

 

[Herr Tubthumper]

Just been reading about how work is subcontracted and subcontracted and subcontracted out. Pretty shitty if you’re the cleaner at the end of the chain doing this work as numerous companies will have taken their cut from your salary. And people say immigration drives down salaries......

 

[Lyndhurst 14]

That is not unusual, or indeed a surprising figure given the scale of their workload.

Just to elaborate on how retention works in the industry. As a sub-contractor, I will put in an application for the value of my work on a monthly basis (or whatever terms are agreed), and the Main Contractor (Carillion) will value that work, certify it and pay it. BUT there will be a Retention element held back, as you say, but those "contractual obligations" run for longer than you may realise. Typically, 5% Retention is held throughout the job, with half of that being release at "Practical Completion" of either your element of the work, if you are say a groundworker, or typically when the building itself reaches practical completion if you are a finishing trade. But the second half of your retention will be held for either 12 or 24 months to cover for latent defects. So, basically, the Main Contractor holds 2.5% of your money in case things go wrong after you've finished. You should get the opportunity to return and put those defects right at your cost, but failing that - if you just refuse, or cannot be contacted - then the Main Contractor will deduct the cost of the rectification works from your Retention.

In turn, I would expect a pretty hefty line in Carillions debtors to be Retentions owed to them from their clients. And there are just two hopes of the liquidators seeing that money, Bob Hope and No Hope. The clients will offset a multitude of disruption costs against the outstanding monies owed to Carillion that will in most cases extinguish the value completely.

As you say, the ripple effects of this will spread far and wide. A lot of people will have lost a lot of money with Carillion going down.

From your eloquent explanation of retention I assume you are a QS as well ! I couldn't be bothered to go into the detail. Lucky it wasn't over here that it happened - they hold 10% typically.

CIOB are now saying that 30,000 firms could be at risk. I remember working with Carillion when I was at Gatwick - they seemed a well managed outfit, how they got in such a mess beggars belief.

http://www.globalconstructionreview.com/news/30000-firms-risk-carillion-meltdown/

 

[Gritt23]

From your eloquent explanation of retention I assume you are a QS as well ! I couldn't be bothered to go into the detail. Lucky it wasn't over here that it happened - they hold 10% typically.

CIOB are now saying that 30,000 firms could be at risk. I remember working with Carillion when I was at Gatwick - they seemed a well managed outfit, how they got in such a mess beggars belief.

http://www.globalconstructionreview.com/news/30000-firms-risk-carillion-meltdown/

LOL, oh sorry mate, didn't realise you were a QS, that must have read like me telling granny how to suck eggs.

No, not a QS myself, Finance Director in the construction Industry and have been for 10 years now. So, I've got to know the workings of these things pretty well. It is a real shame as for many years Carillion have been a very good company, although their cashflow has been a bit suspect for a while. They were certainly one of the first to go down the reverse discounting route, and then couldn't get enough of it, having credit lines for that with 3 separate banks.

At my last place Carillion really did us a good turn when we found ourselves in difficulties, and my current place has been on their job at Battersea since 2011, and done many other projects with them. We've come out unscathed having recently agreed Final Account and been paid in full (incl retention), but if this had happened 18 months ago, it would have been significantly damaging. I know a few people involved from both sides of the fence, either employees at Carillion, or a friend who has a very successful Yorkshire based construction company, and a couple of years ago expanded to London, largely on the back of work he had lined up with Carillion after many years of working with them on big projects in the North. Nasty times.

 

[Lyndhurst 14]

LOL, oh sorry mate, didn't realise you were a QS, that must have read like me telling granny how to suck eggs.

No, not a QS myself, Finance Director in the construction Industry and have been for 10 years now. So, I've got to know the workings of these things pretty well. It is a real shame as for many years Carillion have been a very good company, although their cashflow has been a bit suspect for a while. They were certainly one of the first to go down the reverse discounting route, and then couldn't get enough of it, having credit lines for that with 3 separate banks.

At my last place Carillion really did us a good turn when we found ourselves in difficulties, and my current place has been on their job at Battersea since 2011, and done many other projects with them. We've come out unscathed having recently agreed Final Account and been paid in full (incl retention), but if this had happened 18 months ago, it would have been significantly damaging. I know a few people involved from both sides of the fence, either employees at Carillion, or a friend who has a very successful Yorkshire based construction company, and a couple of years ago expanded to London, largely on the back of work he had lined up with Carillion after many years of working with them on big projects in the North. Nasty times.

No worries.

Nasty times indeed. Unfortunately a lot of innocent, hardworking companies and individuals will get caught up in this nightmare before it’s finished. It looks a little more promising now with the government, banks and even HMRC realizing the need to act swiftly rather than endless meetings and finger pointing. It will still be too late for some smaller companies without liquidity who rely on prompt payments for cash flows. Lot of coverage in Building magazine today, none of which makes very pleasant reading. The worrying thing about this is the domino effect, there are already major players like Balfour Beatty having to write off millions because they are contractually obliged to finish projects where they were in JVs with Carillion.

I think British construction is amongst the best in the world. It’s certainly as good as US construction, which from my experience has a lot of major projects going over budget and over schedule. That’s why it’s sad whenever you see this kind of situation happening. Maybe the UK government should get involved in some kind of bail out similar to when the US government bailed out the auto industry as it was too big to fail, they lent them the money to get back on their feet and then had a strict timetable for repayment – even made a profit on the deal for the taxpayer.

 

[Lyndhurst 14]

Good to see that although the Carillion workforce and pensioners have been screwed the big 4 accountancy firms have managed to extract £71M in fees with PwC managing to trouser £21M.

And they wonder why these guys get a bad wrap

http://www.constructionmanagermagazine.com/news/big-four-accountants-feasted-71m-carillion-fees/

 

[CHAPPERS]

And another

https://www.theguardian.com/busines...administration-after-shareholders-reject-deal

Government contractor Interserve is to go into administration after its largest shareholder, the US hedge fund Coltrane, led a rebellion against financial restructuring plans drawn up by the company’s lenders.

 

[blockhseagull]

And another

https://www.theguardian.com/busines...administration-after-shareholders-reject-deal

This one isn’t a surprise at all, have been going backwards fast for over a year and backed out of several contracts they won.

 

[Jesus Gul]

And another

https://www.theguardian.com/busines...administration-after-shareholders-reject-deal

They run the Estates department up at Uni of Sussex...FREE MATCHDAY PARKING EVERYONE!!!!