An Orange County company that imports specialty tiles from Italy, Spain and elsewhere has filed for bankruptcy protection citing difficulties stemming from the Covid-19 pandemic.
Cera Tile Inc., Middletown, has $1.5 million in assets and $11.3 million in liabilities, according to a balance sheet included with a Chapter 11 reorganization petition filed on March 9 in U.S. Bankruptcy Court, Poughkeepsie.
“Financial difficulties arose primarily from economic conditions following the Covid-19 pandemic,” Cera president Steven Wecera declared in a court filing, including higher international freight costs, inflated operating expenses, tariffs on imported materials, and closures of many independent customers that comprised a significant part of the company’s business.
Wecera also cited competition from large national retailers that captured market share from smaller retailers served by Cera.
The company was incorporated as Victory Mosaic Inc. in 2009 and renamed as Cera Tile Inc. in 2018. Wecera owns 70% and Angi Sundar owns 30%.
Cera imports tiles made of ceramics, porcelain, stone and other materials. It sells the products as a wholesaler to home improvement stores and industry professionals, and as a retailer directly to customers through e-commerce channels.
Cera leases a 72,000-square-foot warehouse on Smith Road, near the intersection of I-84 and NY-17.
Among its largest secured and unsecured creditors are Live Oak Banking, Wilmington, North Carolina, $5.7 million for a purchase money security and a second mortgage; the U.S. Small Business Administration, nearly $2 million; Gulf Coast Bank & Trust in Louisiana, $493,000; and Caldia Ceramics near Valencia, Spain, $200,000.
As the business struggled, Cera relied on merchant cash advance financing, where a company gets quick capital in exchange for a percentage of future sales and high interest rates.
The financing strained Cera’s cash flow, Wecera said, and in some instances the creditors contacted customers directly, “demanding payment, damaging customer relationships and negatively affecting business operations.”
Wecera projected annual revenue of $2.2 million and said the company “continues to actively pursue additional contracts and product opportunities.”
