Phoenix Venture Holdings, the parent company of collapsed car maker MG Rover, made a loss of more than £40m in 2004 compared with a profit of £18m in the previous year, its much delayed accounts will show.
PVH's six directors were paid a total of £1.08m, down from £1.2m in 2003, with the highest-paid getting £259,000. However, there was no repeat of the controversial payments into a directors' pension trust fund, though £210,000 was paid into a fund for other managers.
The accounts should have been filed in October last year; they have now been signed by the directors and are expected to be filed this week, close to the deadline set by Companies House last month, when it warned it could take legal action unless produced within 28 days.
The bulk of the 2004 losses are a result of provisions for potential liabilities, creditors, and inter-company debt as a result of the subsequent collapse of MG Rover. Rover went into administration a year ago, after failing to secure an alliance with Shanghai Automotive (SAIC) of China.
Net funds are put at £26.4m, though about £23m was lodged in a special account, to which PVH had no access, set up as part of PVH's engine manufacturing subsidiary, Powertrain's agreement to supply petrol engines to Land Rover, owned by Ford. The money was meant to ensure continued engine supply if Powertrain went into administration and was drawn down when this did in fact happen.
PVH has now approached Ford for an accounting breakdown of how the money was spent. "The issue ... is one we would like to resolve favourably in order to add further benefit to [Longbridge employees'] fund," the PVH directors said in a statement last night.
Ford responded with suprise at the PVH move. "They asked for this arrangement to be put in place to enable them to secure the sale of the intellectual rights to the K Series engine to SAIC ... We went to great lengths to keep PTL going, even after MG Rover's collapse by, for example, paying the Powertrain Ltd wages for two weeks and working with the administrators to try to secure a rescue package. Our costs as a result of Powertrain going under are well in excess of £23m. Despite stockpiling, we had to stop selling Freelander in North America, Mexico, and the Gulf, and go to a single production shift at Solihull."
The accounts do not cover MG Rover or any other PVH subsidiary which went into administration at the same time. The PVH directors said they were giving unpaid help to try to bring jobs back to Longbridge, particularly Nanjing Automotive, which bought MG Rover's assets, and also managing remaining PVH assets to benefit the fund for former Longbridge workers.
