ASIC data shows 1004 liquidations and administrations in QLD, up 23.5 per cent

Queensland businesses face a tough few months after a 23.5 per cent spike in company collapses over the past year. SEE THE FULL LIST

Struggling Queensland business owners face a “horror show” over the coming months as the taxman circles and operating costs spiral in the wake of a 23 per cent spike in insolvencies over the past financial year.

The lingering impact of the Covid-19 pandemic and skyrocketing inflation and interest rates sparked a wave of company failures with businesses collapsing and owning hundreds of millions of dollars.

The number of administrations and liquidations in Queensland soared 23.5 per cent to 1004 in the 2023 financial year, according to Australian Securities and Investments Commission data.

But the outlook looked to be improving last month.

There were 85 administrations and liquidations in June in Queensland, down 2.3 per cent from 87 in May and off 5.5 per cent from the 90 notched up in June last year.

Nationally, administration and liquidation numbers jumped 17.2 per cent to 5520 for the financial year.

Some of the major Queensland casualties in 2022-23 were home builders LDC, Oracle Homes, Pantha Homes and Lanskey Constructions while developer Property Solutions Holdings went into voluntary liquidation following the collapse of a major project on the Gold Coast last year.

Sunshine Coast-based construction services company Scooter Group also called in the administrators as did Yatala-based VAC Group.

Brazilian Beauty founder Francesca Webster – who was a finalist in the 2014 Telstra Business Women’s Awards – put two of her companies into administration while tech company Everledger, founded by former Queensland chief entrepreneur Leanne Kemp collapsed owing creditors more than $10m.

Gold Coast cryptocurrency platform Trigon Trading collapsed owing $80m and Digital Surge called in the administrators.

Oracle Homes collapsed late last year.

Revive Financial head of business restructuring and insolvency Jarvis Archer said company directors who received penalty notices from the Australian Taxation Office (ATO) last year but did not act on them were at particular risk.

“There’s a horror show coming to light for directors who received director penalty notices in 2022 that have since expired,” he said.

Mr Archer said that increasingly, small business owners are being forced to get second jobs to prop up their business or pay their rent or mortgage.

“It’s a grim reality that after three years of uncertainty and difficult trading conditions, there’s no prospect of things improving in the foreseeable future,” he said.

“During increasingly difficult circumstances, without hope, it’s hard to continue trading.”

WCT Advisory managing partner Andrew Weatherley said the wave of collapses will continue.

“We’ve seen an increase in the number of people wanting to know what their options are or they’ve had enough and want to put their companies in liquidation and close their businesses,” he said.

“It’s very hard out there. It’s been a difficult slog for quite a while and people are getting to the end of their tether.”

Mr Weatherley said the construction sector still took up most of the failures but in the present economic climate of interest rate rises and inflation will put increased pressure of the food service and retail sectors.

“It’s a real challenge having struggled over the past two to three years with out making any money and now there is the pressure on discretionary spending, especially in their target markets,” he said.

Originally published as ASIC data shows 1004 liquidations and administrations in QLD, up 23.5 per cent