Cairngorm mountain railway operator goes into administration

The company that runs the funicular railway at Cairn Gorm has been placed into administration due to unsustainable cash flow problems after its closure.

The Cairn Gorm mountain railway operator has gone into administration. Picture: David Cheskin/PA

The funicular has been shut since the start of last month because of safety concerns over structures supporting the tracks.

Administrators Campbell Dallas said there were no immediate plans to make any redundancies at CairnGorm Mountain Ltd, which operates the railway.

It will continue to trade the business while progressing discussions with a potential buyer for a sale of the business and assets as a going concern.

Highlands and Islands Enterprise (HIE) said it is confident Cairn Gorm will remain open for business and the situation can be turned around.

Last month it approved a £1 million investment in a snow-making machine and snow cannons to ensure the mountain can open for skiing this winter.

Blair Milne, business recovery partner with Campbell Dallas, said: “Due to the extended closure of the funicular railway at Cairn Gorm mountain for safety reasons, the business has become unsustainably loss-making.

“The directors of the business had been in discussions to try to find suitable solutions, including a managed transfer of the business to another party, however those negotiations did not progress.

“Under mounting cash flow and creditor pressures, the directors were left with no alternative other than to place the business into administration.

“The joint administrators will be seeking to achieve a sale of the remaining business on a going concern basis as early as possible.”

The CairnGorm railway and mountain snowsports centre are owned by HIE and operated on its behalf under a lease by CairnGorm Mountain Limited, which employs around 70 staff.

Investigative works on the funicular are still under way.

Charlotte Wright, chief executive of HIE, said: “The directors’ decision to put Cairn Gorm Mountain Ltd (CML) into administration is an outcome that HIE had anticipated, and we are well prepared.

“Our first priority is staff members and their families, as well as other local people who will be affected by this decision.

“We are already in direct contact with the administrator, and confident that Cairn Gorm will remain open for business.”

She added: “Clearly, this is not the outcome that anyone wanted when CML became the operator.

“However, with local support, we are confident that the situation can be turned around and we will see Cairn Gorm flourish again as a fantastic asset for this area, its economy and its people.

“One million pounds worth of snowmaking equipment, paid for by HIE, has arrived and will be set up on site as soon as possible. This will provide reliable snow cover for visitors on the lower slopes, creating good conditions for beginners and families especially.

“It also means that when there is suitable snow on the higher slopes, more experienced skiers can access those levels by tow.”

The funicular takes skiers, snowboarders and walkers two kilometres up Cairn Gorm mountain, carrying around 300,000 people every year.

It opened on Christmas Eve in 2001 following an investment of around £20m.