The south east developer is considering possible provisions to be made against certain asset values in its accounts with its auditors.
This follows a tightening up of its corporate procedures after an independent report by accountant FRP Advisory discovered “significant and repeated failures’ in previous board level corporate governance.
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While the amount of such provisions have still to be fully determined, the AIM-listed firm warned the market late on Wednesday that “it appeared likely to trigger a breach of the asset cover covenant applicable to the loan between Inland ZDP and Inland Homes.”
Inland ZDP PLC was formed at the end of 2012 as a funding vehicle to issue zero-dividend preference shares, due to be cashed in April 2024.
The latest warning comes just over a month after veteran house builder Jolyon Harrison was appointed as CEO in a bid to turn the business around.
He joined after Inland delayed publishing its latest results for the year to September 2022 while a series of accountants went through transactions in the books. Losses are expected to hit £91m.
The announcement is set back for Harrison, a former CEO of MJ Gleeson, who joined as Inland agreed a £4m acquisition of West Yorkshire firm NorthCountry Homes, which Harrison held a 51% stake in.
His plan for Inland is to pivot from its traditional market in the South and South East of England and focus on new low-cost home developments in the North.
