Muffin Break Stockland Rockhampton liquidation: Latest reports

The takeaway cafe business started to lose money in the Covid-19 pandemic and despite a government support loan, wasn’t able to recover. Here’s what the latest liquidation report has revealed.

Muffin Break at Stockland Rockhampton is for sale after the previous franchisee filed for liquidation.

Muffin Break at Stockland Rockhampton had tallied up almost a year of outstanding rent, according to the latest liquidators’ report.

The company, directed by Rockhampton businessman Rohan Smith, was incorporated in 2014 and operated a takeaway cafe business at the shopping centre food court.

The company ceased operating the business in November, pending a sale agreement to the franchisor, Food Co, that owns Muffin Break and Jamaica Blue.

The company ultimately went into liquidation on February 2, 2022, with Michael Beck of Worrells Solvency and Forensic Accountants appointed as the liquidator.

A report lodged to the Australian Securities and Investments Commission in April estimated the company had an outstanding debt of $187,015 to a total of four creditors with realisable assets of $34,488.

Food in the cabinet of Muffin Break at Stockland Rockhampton.

As noted in previous articles, the main creditor was the Queensland Government in relation to a small business relief loan for financial difficulty during the Covid-19 pandemic.

The liquidator’s reports refer to the company’s internal balance sheets which identify regular monthly losses around the initial Covid onset of April 2021, with consecutive monthly losses from July 2021 until November/December 2021.

The report notes the “company entered an agreement for termination of its franchise agreement and ceased trading around November / December 2021 which included payment/ remission of outstanding rent totalling $109,085.56 (lease held by franchisor)”.

Based on the company’s statements, it is understood the company had about 11 months of outstanding rent owing on the trading premises.

Mr Beck stated the company appeared to have been insolvent since January 2021.

The liquidator’s report notes no staff are owed any money.

The Muffin Break Rockhampton franchise is still advertised for sale on the Muffin Break website.

OUTSTANDING DEBT

Secured creditor:

QRIDA – Queensland Rural and Industry Development: Authority

$143,000

Small business loan provided as part of various covid relief measures

Unsecured creditors:

ANZ bank: $14, 639

ATO: $24, 764

Griffin Hancock Moffit (accountants): $4,612