A North Yorkshire supplier of pipeline maintenance services to the global oil and gas industry has fallen into administration with the loss of 83 jobs.
Kroll directors have been appointed to Catterick-based Pipeline Engineering & Supply Co. Limited after its parent company Circor International Ltd failed to find a buyer for the business, which it said had seen “accounting irregularities”.
Circor said it wanted to leave the Pipeline Engineering & Supply Co business in March after discovering the irregularities – which it said appeared to include balance sheet and income statement entries of around 26.7 million pounds ($35 million) to £34.3 million ($45). m) pre-tax income on a cumulative basis over a period of at least five years.
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A review of the irregularities had been carried out by an outside law firm and an accounting firm under the supervision of the audit committee of the company listed on the New York Stock Exchange. The administration has no impact on the rest of Circor’s UK operations.
Pipeline Engineering – described as a “world leader in the design, manufacture and testing of pipeline pigging and flow assurance products” – had been active for over 50 years and had operations in Aberdeen and Dubai.
Jimmy Saunders, co-director at Kroll, said: “The company was loss-making because its cost base and infrastructure were not aligned with revenue.
“The group has made substantial investments in the business, but with the current economic uncertainty and inflation in manufacturing costs, the group has unfortunately been unable to continue to provide financial support.”
Pipeline Engineering made up about 3% of Circor’s revenue in 2020 and ceased operations effective immediately, and administrators said they were providing support to affected employees.
Pipeline Engineering’s latest set of accounts at Companies House show it made a pre-tax loss of £2m in 2019, on sales of £16.5m.