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Housebuilder McInerney still in breach of its covenants

Irish housebuilder McInerney Holdings said today it is still in breach of its banking covenants after continuing to experience challenging conditions in the UK and Irish housing markets.

In a trading update McInerney said sales in Ireland, UK and Spain were 756 in the year to 31 December 2009 compared to 1,359 homes the prior year.

Total completions in the UK were 582 units in 2009 compared to 750 in 2008. As of 31 December 2009 the firm had 330 deposits on hand compared with 459 the prior year.

In November 2009, McInerney confirmed that it was continuing negotiations with both its UK and Irish funders in relation to revised loan facility structures.

The trading update said: “The group continues to be in breach of certain of its Irish and UK banking covenants.

“Accordingly, the group depends on the continued support of its principal banks for ongoing trading activities.

“However, draft term sheets for revised banking arrangements in both Ireland and the UK are awaited shortly. 

“The group’s priority in current economic conditions is to remain focused on cash generation and the achievement of a stable funding platform.”