The High Court has confirmed the appointment of an examiner to the Xtra-vision chain of stores employing 1,300 people.

The company, which has 180 stores across Ireland, was granted court protection from creditors last month after it said it was insolvent and unable to pay its debts as they fell due because of cash flow difficulties.

Mr Justice Brian McGovern said he was satisfied to confirm David Hughes, of accountancy firm Ernst and Young, as examiner of Xtra-vision Ltd. Mr Hughes was appointed interim examiner last month.

The examiner has up to 100 days to devise a rescue plan for the company which will then be put before creditors and the High Court. US firm Blockbuster sold Xtra-vision to Irish firm Birchall Investments in 2009 and Birchall is prepared to invest another €6 million in the company if a scheme of arrangement is approved, the court heard.

Rossa Fanning, for the examiner, said Mr Hughes, in an interim report to the court, had said he had found nothing of significance that would cause him to question an independent accountant’s view the company has a reasonable prospect of survival as a going concern.

Xtra-vision’s difficulties were caused by factors including falling revenues, a decision by two providers of trade credit insurance to Xtra-vision’s suppliers to withdraw their coverage and poor trading figures caused by the bad weather over Christmas and New Year period, counsel said.

High rents were also problematic and, while the company had taken steps to reduce its overheads, it was able to reduce property rental costs by just 8 per cent, counsel said.

It was envisaged, during the period of examinership, applications would be made to the High Court to repudiate a number of lease agreements for premises where Xtra-Vision operates stores, Mr Fanning added.

The court agreed to make Ulster Bank, owed about €1m; the Revenue Commissioners, owed €3.3m; and Blackpool Developments Ltd, which leases a premises in Cork to Xtra-Vision, notice parties to the proceedings.

Mr Fanning said it had received letters of support for the examinership process from Ulster Bank and a trade union representing many of Xtra-vision’s employees.

The company was incorporated in 1980 as a video rental outlet and diversified its services in recent years to sell and rent DVDs, blu-ray movies, video games, hardware and confectionery.