‘An absolute tragedy’: Popular Aussie brewery, Black Hops Brewing, nears collapse

A widely acclaimed Australian brewery has entered administration, pointing the finger at one key obstacle crushing the industry.

Black Hops Brewing, an acclaimed Australian brewery stocked in bottle shops across the country, has decided to enter voluntary administration due to escalating tax debts.

The move comes as a shockwave amid a surge of breweries facing similar financial strains, marking a significant setback for the company’s operations.

The Gold Coast Bulletin reported on Thursday that Black Hops Brewing informed its investors late on Wednesday about the appointment of Deloitte to oversee the company’s affairs following what it described as a “tough decision.”

The popular Gold Coast brewer stated: “This decision has not been easy to make, however, the path the ATO has taken with the business has left the company in a position where there was no alternative.”

Black Hops Brewing, an Australian brewery, has entered voluntary administration due to increasing tax debts.

Founded in 2015 by mates Dan Norris, Eddie Oldfield, and brewer Michael “Govs” McGovern, Black Hops Brewing swiftly gained recognition for its innovative brews, notably the Eggnog Stout.

Over the years, the company expanded its operations, moving from a modest 250sq m building to a sprawling 600sq m brewhouse and later to a super-sized brewery and tap house in Biggera Waters after an crowd-funding campaign that raised $400,000 from 545 investors.

Despite its success in producing approximately a million litres of craft beer annually and achieving national distribution, the company found itself grappling with insurmountable challenges, culminating in the decision to seek voluntary administration.

Tony Sutherland, a director of Black Hops Brewing, lamented the situation, describing it as “an absolute tragedy.”

He added: “Just when things are turning around, we’ve got bureaucracies like the ATO come and take it away – it’s a tragedy.”

Black Hops Brewing assured its patrons that beer production and taproom operations would continue unabated during the administration period.

The company also outlined plans to propose a Deed of Company Arrangement (DoCA) to creditors to avoid liquidation and preserve shareholders’ equity.

Deloitte administrators David Mansfield and Tim Heenan have been tasked with managing the administration process.

Black Hops Brewing Co founders Eddie Oldfield, Dan Norris and Michael McGovern. Picture Mike Batterham

The ongoing burden of excise tax on alcohol remains a significant concern for independent brewers across Australia.

The industry argues the biannual increase in excise tax has exacerbated financial pressures on small and medium-sized breweries.

Critics argue that the escalating excise tax contradicts the Federal Government’s efforts to provide tax relief for small breweries and distillers.

Stef Constantoulas, co-founder of Sydney’s Philter Brewing, highlighted the disparity, in January told news.com.au: “Excise tax is the biggest gripe we have as an industry. We pay the same amount of excise that Lion or CUB do.”

Numerous independent craft beer operations that have collapsed this year have cited the tax as a catalyst.