AN HISTORIC Liverpool company who made the flag carried by Scott of the Antarctic to the South Pole has become the latest victim of the credit crunch.

Porter Brothers, whose flags were also draped on the coffins of Winston Churchill and Princess Diana, has had its colours lowered by the recession and production problems.

The company has been wound up with the loss of 17 jobs after more than 100 years of producing flags, banners and bunting, some of which made its way to some of the 21st century’s greatest historical moments.

Managing director Barry Clare said a mixture of circumstances had led to the demise of the business, which employed 300 staff at the height of its popularity.

In a statement made via insolvency practitioners Begbies Traynor, he said: "Since the beginning of 2008, the company has experienced production problems as the result of the death of a key member of staff and illness of the main trimmer, who was off work for a considerable period.

"As a result, the company has been unable to get orders out on time and these problems together with the general economic climate have led to a fall in turnover which has had a serious affect on cash flow."

In December, the directors carried out a financial viability study and concluded there was no alternative but voluntary liquidation. The final deficit was £266,000.

Over many decades, the firm produced flags, banners and pennants for various occasions, including the Queen’s Silver Jubilee in 1977 and the World Cup in 1966.

The firm was founded in 1905 and picked up the prestige job of flying the flag for Captain’s Scott’s 1911 expedition to the South Pole.

Scott was bitterly disappointed to find that he had been beaten by Amundsen when he reached his destination. He planted the flag and then tore some strips off which he carried in his kitbag.