Lido seeks bankruptcy protection

RIGA - The Latvian catering, restaurant and leisure company Lido has submitted a request for legal protection to protect the interests of its creditors, employees and clients, reports Nozare.lv. The program for the out-of-court remedy process will ensure meeting liabilities of the company. Lido continues to operate, as the above-mentioned request does not change the company’s flow of its daily functions.

“Lido was established by me 23 years ago. During this period of time the company has become one of the symbols of Latvia, and like all of us, has experienced good and bad times,” indicated Lido owner and director, Gunars Kirsons. Kirsons is convinced that it is possible to tackle these problems. “Lido will be, it will continue to work and the company will provide food for many generations of Latvians. This is characteristic of Latvians and also of Kirsons,” said the owner.
Lido will provide more comment after the court makes a decision.

Kirsons has submitted a request to the Riga Vidzeme District Court for legal protection of Lido, according to an entry made in the Insolvency Register. The 2009 annual report shows that DnB Nord Bank is the biggest creditor of the company. Also, the State Guarantee Agency has provided security for loans given by banks to the company.
The company operated with a turnover of 18.2 million lats (26 million euros) and losses of 603,342 lats last year. In 2008, turnover reached 25.4 million lats, with losses at 1.7 million lats. In 2007, turnover was 24.2 million lats, but losses stood at 900,000 lats.

Odil Eesti, the Estonian subsidiary of the Latvan parent company, however, is doing well in Estonia, reports Aripaev Online. The fact that the obligations of the Latvia-based Lido exceed assets and the company is asking for out-of-court bankruptcy protection is not directly affecting the company.
Marketing manager Tiina Kost said that Lido will soon celebrate its 1st birthday on the Estonian market, on October 10. “We are quite active on the market,” she said, adding that “the restaurant has a very international clientele.” The summer was good for the company, said Kost, noting that it was a surprise that it posted record results as compared to other months.

Back in Latvia, instead of salary earnings dating back over the past year, an employee of Lido Design Factory has received a promissory note signed by Kirsons, according to the TV channel TV3. Although the employee submitted a letter of resignation, the company’s management have yet to accept and issue the documents necessary for beginning work elsewhere. The man turned to the State Labor Inspection, who where unable to provide assistance.

The employee claims that there are dozens of other people in the company who have found themselves in a similar position. Kirsons provided a written public statement on the matter, explaining that things were not going smoothly for Lido Design Factory, but expressing the hope that orders would soon come in and the situation would improve.
Kirsons admitted to not paying salaries to employees; however, the businessman blamed this on the poor economic situation. The Lido director promised that the employee in question would soon be provided with the documents necessary for finding new employment.

Lido, along with mobile phone operator LMT and food producer Spilva were named earlier this year as companies with the best reputation in Latvia, according to a survey carried out by the daily Diena in cooperation with the public relations company Nords Porter Novelli. Other top companies are confectionery Laima, fuel retailer Latvija Statoil, telecommunications company Lattelecom, and brewery Aldaris.