Administrators of Black Hops Brewing urge creditors to liquidate company amid massive debts

The liquidation of a popular Gold Coast craft brewery looks inevitable after administrators found it had likely been insolvent since 2022. The amount of its crippling debt has also been revealed

A popular Gold Coast craft brewer is likely to be poured into liquidation after administrators found it owed more than $7.3m and had likely been insolvent since 2022.

Black Hops Brewing was placed into voluntary administration in March after directors realised it could not satisfy its mounting tax debts.

In his latest report to creditors, administrator David Mansfield of Deloitee said “multiple” parties had expressed interest in buying the business, which had continued to operate throughout the administration.

The report said Black Hops owed $3.2m in tax and other government charges; $580,274 in employee entitlements; $1.05m to unsecured creditors; and $3.4m to secured creditors.

The administrator’s report did not reveal the value of the company’s assets, “so as not to prejudice” the sale campaign.

Black Hops Brewery is in administration with debts over $7m.

A Deed of Company Arrangement, initially floated by directors in a note to investors, has failed to materialise, the administrator said.

The report revealed Black Hops has raised $6.3m from investors since 2015, while a further $2.63m had been raised via two rounds of crowd-funding.

According to the administrator, sales were down 20 per cent between FY23 and FY24, but that the reduction in sales had not been accounted for by a reduction in costs and spending.

Wage and excise costs were highlighted as contributing to the company’s financial strife.

According to the report, Black Hops had entered a payment plan with the ATO and had struck a deal with Barry Cotter, landlord of its Biggera Waters brewery, to defer rent payments totalling more than $326,000.

“We have formed the preliminary view that the company may have been insolvent as early as December 1, 2022,” the report said, adding there could be an insolvent trading claim of more than $3.36m.

Creditors will vote on whether to place the company into liquidation – a move recommended by the administrator – at a meeting on Wednesday.

Dan Norris, Michael "Govs" McGovern, and Eddie Oldfieldfounded the company. Picture: Glenn Hampson.

Black Hops was founded by mates Dan Norris, Eddie Oldfield and brewer Michael “Govs” McGovern in 2015 after an unexpectedly successful experiment with Eggnog Stout.

Mr Norris has since left the company, which bought out his shares.

The company operates breweries and taprooms at Burleigh Heads, Biggera Waters and Brisbane, as well as the Haven Bar & Restaurant, also at Burleigh.

The Brisbane operation, bought from Semi Pro for $580,000 in 2020 has been closed down.

Between the breweries, Black Hops brews more than a million litres of craft beer a year, is stocked in bottle shops and bars nationwide and employs up to 70 staff.

Originally published as Administrators of Black Hops Brewing urge creditors to liquidate company amid massive debts