好色先生TV

Jarvis is expected to propose a change to its borrowing facility to banks and shareholders, as it seeks to take its overdraft limit up to an allowed maximum of 拢350m.

At its extraordinary general meeting on Monday, a Jarvis spokesperson said the company would propose a change in the way its total debt was calculated. This would allow the company to exclude cash tied up in its Tube Lines investment from its total debt level.

The spokesperson said this move would give the company more flexibility to change its level of debt while it continued its asset disposal programme. 鈥淚t鈥檚 not about looking for more money; it鈥檚 about sorting out an anomaly in our articles of association,鈥� he said.

At the same time, the firm鈥檚 new chief executive, Alan Lovell, is expected to propose to Jarvis鈥� banks that the firm be granted an extension of its borrowing facilities until at least the end of 2005. In the summer, the firm struck a deal with its two banks, Royal Bank of Scotland and Barclays, to extend facilities until next March.

The cash crisis comes as Jarvis admitted in a trading statement issued this Monday that its financial position had worsened since that recovery deal, with expenditure increasing by an unbudgeted 拢80m.

One source said the firm鈥檚 finances were in a desperate state and estimating current borrowing to be at least 拢250m. On this basis, he said, 鈥測ou are having to pay back about 7%, which is 拢17m a year. With a 拢500m-turnover firm making 4-5% margins, it doesn鈥檛 really stack up. You鈥檙e living on the edge, aren鈥檛 you? You are working for the banks, not the shareholders鈥�.

The firm鈥檚 share price halved in value to about 15p as the market responded to the trading statement.

City experts are increasingly questioning Jarvis鈥� long-term future. Geoff Allum, from analyst Investec, said: 鈥淭here will be life for Jarvis after this, but for how long? The banks only have so much patience.鈥�

There will be life for Jarvis after this, but for how long? The banks only have so much patience

Geoff Allum, Investec

Sources close to the firm agreed that its present plight was concerning. One said: 鈥淚t is losing cash every day. It is very worrying.鈥�

In the statement on Monday, the firm said that 60% of the 拢80m extra cash outflow was from its remaining construction contracts. It also said that it been hit by a failure to sell 39 properties for 拢20m, and it had realised only 拢11m in unpaid work completed for Network Rail, 拢9m less than it expected.

The firm said it was in talks to bring in partners to complete outstanding construction work. The statement said: 鈥淭he group continues to incur losses during the current financial year. It also means that the group now anticipates that a substantial proportion of the proceeds from its asset disposal programme is likely to be required for working capital purposes rather than repayment of debt.鈥�

In a further statement, the firm confirmed that its schools PFI deal with Norfolk council, which it was hoping to sell to French group Vinci, had collapsed.

But it said that the sale of its European roads business and stake in the Tube Line PPP deal would be completed by December, as predicted in 好色先生TV last week.

Jarvis said it had identified a further 拢30m in savings under the review carried out by Lovell, which would be implemented over 鈥渢he next few weeks鈥�. This will leave a core business of rail, roads and its York-based plant hire division.

But sources question how well this strategy will work. The roads business has been trading below budget, and one source claimed the rail business鈥� work on the West Coast main line was coming to an end.