Kwik-Fit Debts Reach £822.1 million in 2008
Kwik-Fit has warned that it may risk breaching its banking covenants after being hit by increased debts and foreign currency effects in 2008. Kwik-Fit, which supplies around 5 million tyres a year in Britain, reported that net debts increased from £96.6 million to £822.1 million last year. Nevertheless Kwik-Fit reported flat operating profits of £75.7 million last year and managed to grow sales 9.8 per cent (up 0.5 per cent if you only count like-for-like sales) to £942 million despite the recession. However, according to a Sunday Times report on the company’s annual accounts, Kwik-Fit has already sold most of its freehold properties in an attempt to reduce its borrowings.
Directors and staff, led by the chief executive, Ian Fraser, own 11 per cent of Kwik-Fit’s shares. According to the Herald newspaper, Ian Fraser saw his pay and benefits surge by 40 per cent last year. Citing accounts filed at Companies House the report points out that the highest-paid director (assumed to be Ian Fraser) got a pay rise of £200,000 to £700,000 in the year to December.