The Sefton Group has recorded a profit of £10.3m for the last financial year, marking a turnaround in the company’s position following the government’s intervention and the financial restructure completed in April 2013.
The government gave it a total of two loans and the issue was top of the political agenda last week after a lawyer who investigated them decided they were ‘ultra vires’ or ‘not lawful’ as he put it in his report.
The incident proved explosive politically and led to John Shimmin, the Minister for Economic Development, resigning from the Council of Ministers.
He offered to resign when the news broke on Tuesday and his resignation was accepted on Thursday.
Speaking at the Sefton Group’s annual general meeting today, retiring chairman Sir Miles Walker praised the government’s ‘courage’ in supporting the company during a difficult period.
Sir Miles said: ‘The overall profit of £10.3m, albeit exceptional in nature, has reversed much of the damage caused by losses in the 2010-12 period and substantially improved the net assets of the group.
He added: ‘Everything that the group has achieved in the last 12 to 15 months in terms of financial turnaround, the raising of new capital and the elimination of £32m of debt was made possible by the restructure, and the restructure itself was made possible by the government’s acquisition of Middlemarch [the site on the corner of Lord Street and Walpole Avenue in Douglas] and the provision of a working capital loan to supplement the other £13m of funds that we independently raised.
‘In the circumstances, this was a politically courageous intervention on the part of government and there is no doubt that it has worked. The group has regained strength; since the restructure we have been able to contribute £2.8 million in taxes, interest and fees to the public purse and we are working together with government to enhance the development potential for the centre of Douglas.’
Sir Miles said he regretted John Shimmin’s resignation as Minister for Economic Development.
‘I must say that we are most appreciative of government’s support in helping us to emerge from a very challenging period in the history of this important island business,’ Sir Miles said.
‘It is therefore a source of great regret to me that a senior minister has resigned over the “vires” issue and that the Chief Minister and his ministerial colleagues continue to be criticised for supporting a measure that protected local jobs, local suppliers and local investors, surely the very things that a government is meant to do.
‘Bearing in mind that the Sefton Group is the employer of 340 people, the customer of 150 local companies and is owned predominantly by 550 local shareholders the government deserves plaudits, not brickbats for supporting such a key player in the Isle of Man economy.’