The Jubilee Sailing Trust has confirmed that three roles are being made redundant after one of its subsidiary charities went into administration.
The Jubilee Sailing Trust Ltd, one of the subsidiaries through which the JST works, has been forced into administration after a creditor threatened legal action to recover money it is owed, according to a statement.
The charity hosts sailing trips for mixed groups of disabled and non-disabled people.
The news comes less than six months after the JST warned that the charity would have to “face the harsh reality that we may not be able to continue” if emergency fundraising efforts to raise £500,000 failed.
That appeal was successful but the JST recently said it was trying to raise a further £700,000.
A separate emergency campaign raised more than £1m in 2019. At the time, JST sent a serious incident report to the Charity Commission because of the state of its finances.
The most recent annual accounts for JST Ltd, for the year ending in March 2021, showed that loans worth just under £850,000 would need to be repaid during the following 12 months.
JST Ltd’s longer-term creditors include the parent charity, which is owed about £1.4m to cover advance payments.
The JST did not say which creditor had threatened legal action.
JST Ltd owns one of the charity’s two ships, STS Lord Nelson, which has been decommissioned and which the JST is trying to sell to cover some of its debts.
The JST’s second ship, SV Tenacious, is owned by another subsidiary, JST (Tenacious) Ltd. The charity stressed it was still “delivering our current voyage programme” using Tenacious.
JST Ltd also handles much of the charity’s financial and trading work.
The JST said that “essential shore-based employees are being transferred to JST (Tenacious) Ltd” while people employed as crew on the ships “are employed via an agency, whose contract will be continued with JST (Tenacious) Ltd”.
A JST spokesperson told Third Sector: “We can confirm there will be three roles being made redundant.”
The charity’s income was £2.1m in 2020/21, compared with £3.1m in 2019/20, after Covid-19 restricted its services.
The value of the JST’s assets fell by £925,000 in 2020/21, after the Lord Nelson was revalued following its decommissioning.
Patrick Fleming, chief executive of the JST, left the charity last month. It has not yet named a replacement.
It said in a statement that “the financial position of the JST has been extremely precarious for some time”.
The charity added: “Unfortunately, despite the fantastic support received over the past few months, we have been forced to make the difficult decision to enter JST Ltd into administration.
“This decision was made after one of our principal creditors threatened imminent legal proceedings to reclaim their owed credit.
“Regardless of our recent organisational restructure and ongoing development review, this situation escalated rapidly and the sale of Lord Nelson will not be possible within this new timeframe.”
The JST said it had negotiated with creditors about delaying repayment schedules, but had not been able to avoid JST Ltd going into administration.
It said: “With JST Ltd now in administration, the assets owned by this company will be sold to generate funds for creditor repayment.
“Lord Nelson will be taken over by the administrators for this purpose.”