The closure of a cold storage contractor ICA Group left many businesses hundreds of thousands of pounds out of pocket, new documents reveal.

Simon Baseden could not believe his bad luck when he was told ICA Group was about to go bust.

Two days earlier he had found out that another contractor his firm was working with, Allen Wilson Construction, was going into administration owing his business Ashford Air Conditioning more than £102,000.

Paddock Wood-based ICA, which had developed cold storage buildings since 1937, had owed the company more than £23,000.

Fortunately, technical services director Mr Baseden had recovered half the fee owed to the firm days earlier but the loss had a significant knock-on impact.

The company had to put on hold plans to extend its office at Ashford Business Park and halted preparations to hire two new staff.

Mr Baseden said: “It cancelled our plans for six months. It was annoying because we had spent six months saving the money to do the work and then had to use it to cover the losses.

“If we had lost any more we would have had to make redundancies and cutbacks. We would have been in recovery mode.

“Fortunately we had sister companies which were able to give us some internal lending.”

ICA Group went bust in March owing creditors nearly £4m, documents filed at Companies House reveal. Administrators were able to cobble together assets of £437,000 to pay its unsecured creditors, leaving a £3.5m shortfall.

The collapse of the company, fully known as International Controlled Atmosphere Ltd, cost 74 jobs and left 310 companies out of pocket.

The worst affected Kent firm was TLC Industrial Roofing and Cladding, in Sandway, near Lenham.

"If we had lost any more we would have had to make redundancies and cutbacks..." - Simon Baseden, Ashford Air Conditioning

The company was owed more than £114,000 after being contracted by ICA in November to work on the roofing of a new cold storage at fruit farmer GH Dean in Sittingbourne.

The firm was asked to get on site quickly and began building in December but managing director Jamie Cook said alarms bells started ringing when accountants insisted on invoices being submitted before the job started.

His concern increased when ICA asked TLC to carry out alterations on the building’s steel structure rather than hiring in a steel contractor themselves.

He said: “I spoke to the accountants of the steel contractor and they had invoices outstanding for more than 90 days and they weren’t going back until they got paid. I thought ‘oh no’.

“I pulled my guys off the site in February. We had completed the roof and were halfway through the cladding.”

ICA Group blamed its collapse on contractions in the farming and agriculture sector for putting pressure on cashflow over the past few years.

It appointed administrators on March 21 after attempts to restructure the company failed.

Mr Cook said: “Losing that money affected cashflow but we had a lot of work on the books at the time and we managed to trade through it and come out the other end. All our subcontractors got paid and we took the hit on our profits but there is no lasting damage.

“The only thing you can do is look at your overheads or ask the bank for a bigger overdraft to trade through it.

"It is better to make sure every job makes a profit rather than cutting your losses.”