Hemmes group feels the chills of Covid
The champagne may still be popping at Justin Hemmes’ Sydney venues, but his accounts show a very different story for the pub baron.
Accounts just in for the year to June 30 reveal that Hemmes Trading, the company that operates the Hemmes family’s hospitality empire and portfolio of investment properties, recorded profit of just $280,000, down from $4.344m the year before.
COVID-19 has hit the company, which owns the Merivale group of more than 70 venues and brands including the Ivy Precinct in Sydney’s CBD and the Coogee Pavillion, hard.
Directors have revealed that current liabilities exceed current assets by a massive $60.6m.
“Notwithstanding this position the financial statements continue to be prepared on a going concern basis,” the directors said.
This optimism was thanks to a “letter of support” from other director-related entities.
“These [companies] have confirmed that they will not call the related-party balances and they will provide additional financial support to allow the company to pay their debts as and when they fall due for at least 12 months,” the Deloitte-audited accounts said.
Hemmes Trading is backed by the family’s own trust. Other directors include Hemmes’ sister Bettina, his mother and the operations’ namesake Merivale and Angela Muller as directors.
The company’s auditor noted related-party receivables of $52.2m to Hemmes Finances — an entity of the Hemmes’ family trust — but also noted the entity’s commitment to continue to provide financial support even while the debt kept rising.
Even after measures introduced by NSW Premier Gladys Berejiklia n brought restaurant and bar patronage to a standstill, the group still clocked $285.1m in revenue for the year, a more moderate 16 per cent slip from 2019 — which on our calculations equates to a hell of a lot of Hemmes’ microwave home dining kits.
For all her hits to the hospitality industry, though, it seems Berejiklian has offered some support, with $4.87m in deferred state tax payments recorded in the group’s books.
Pandemic or not, the acquisitive Hemmes has continued his quest to own each and every pub across Sydney, after the financial year end signing a $32m deal to buy Randwick’s Duke of Gloucester pub, affectionately known as “The Dog” from Good Beer Co.
Waislitz pops question
So much to celebrate.
Billionaire about town and Collingwood Magpies vice-president Alex Waislitz popped the question last week to Rebekah Behbahani — the couple already have a daughter, Storm, who is almost one year old — but saved the big celebration for Monday night in Sydney at millionaire businessman Leon Fink’s wharfside restaurant Otto.
The Thorney founder, 62, and his 29-year-old fiancee, who have been stepping out for about three years after first going public at the 2018 Melbourne Cup Carnival, became engaged in Melbourne on Friday before gathering family and friends this week at Woolloomooloo and the home of Fink’s $140 rock lobster spaghetti.
Margin Call’s spies report that the Fink Group chair greeted the happy couple as they entered the restaurant, with the engagement table featuring friend and Thorney director Gary Weiss, as well as Rebekah’s sister and Real Housewives of Melbourne star Venus Behbahani-Clark and her husband James Clark.
The betrothal is happy news for the couple. There will probably be some legwork to come, however, ahead of nuptials.
Waislitz shares three children with his heiress wife Heloise, the daughter of late cardboard box billionaire Richard Pratt and sister to fellow billionaires Anthony Pratt and Fiona Geminder.
The couple separated in mid-2015, but did not divorce.
They continue to officially both live in the family’s Toorak mansion and remain co-directors of a range of corporate vehicles including Thorney Holdings.
Meanwhile Behbahani, who has worked as a management consultant at KPMG, is living elsewhere in Toorak, near her sister.
The siblings recently started a new entity, Behbahani Productions, in which they are equal shareholders. We note Waislitz’s background as a sometime movie producer.
But back to the Sydney celebrations, where we hear that guests — not too socially distanced — ate and drank looking over the spectacular city views and grey-headed flying foxes from the finger wharf.
Alas, Waislitz spent most of the time in his trademark hat walking up and down talking business on his phone.
The life of a billionaire.
Juggling balls
Jayne Hrdlicka is going to have her hands full now that summer’s here. The former Bain management consultant is, of course, the new “hands-on” boss of the reincarnated Virgin Australia.
Plenty to go on with there now that borders are opening, Australians are flying and there are unions to negotiate with.
But US-born Hrdlicka, who’s running Virgin from Brisbane despite her family home being in Melbourne, is also chair of Tennis Australia, which is in the final throes of talks with Dan Andrews’ Victorian government on how the Australian Open will be able to proceed early in the new year amid the global coronavirus pandemic.
Accounts just in from TA, whose chief executive is Craig Tiley, reveal the group in the year to June 30 made a net surplus of $5.5m, almost half the $10.7m made in the previous year, with Hrdlicka blaming the impact of COVID on operations.
Margin Call notes KPMG has audited the organisation for no less than 30 years.
Come the new year international players are likely to have to quarantine in Melbourne hotels for a fortnight before the grand slam event.
TA has revealed it is likely to have to borrow money via a line of credit “to cover the significant costs that have arisen as part of the COVID-19 response to meeting quarantine and biosecurity measures for AO2021”. And Hrdlicka is also bracing for the worst. “This funding will also provide an additional safeguard in the very unlikely scenario that the summer of tennis will be significantly curtailed as a result of a new wave of COVID-19.”
A worst-case scenario we hope never comes.
Cheese disclosure
The first day of hearings in the defamation case brought by former Blue Sky director Elaine Stead against AFR reporter Joe Aston centred largely on Stead’s investment track record, but there was one notable investee company that judge Michael Lee needed no briefing on.
As Stead’s lawyer Sue Crysanthou, a recently anointed silk, went through a lengthy list of the now defunct group’s VC investments and other big name backers such as Mike Cannon-Brookes who had also dipped money into the start-ups, Justice Lee noted there was perhaps a matter to be disclosed, and a cheesy one at that.
He told the court he was more than familiar with the Adelaide-founded wine subscription group Vinomofo, and had in fact been such a regular customer with the outfit that he had received a gratis cheese platter just a week ago.
Neither party had any objection to the disclosure, with the defence noting he would be “more concerned if your honour was buying Shoes of Prey”.
When it came to reading Nine’s newspaper in question, Lee noted a longstanding history with the paper dating back 30 years.
Crysanthou though wasn’t quite as glowing, noting that she only made a habit of it when it appeared in a brief, albeit more regularly of late, with a second case against Fairfax afoot, as brought by iSignthis director John Karantzis.
The court heard that Stead’s reputation had been remarkable up until Aston’s attack, and that he had targeted her and drawn parallels with feminist Clementine Ford purely because she was a female.
No debate on that, but the hearing continues in court on Wednesday.
South32’s succession confusion continues
A year ago South32 was interviewing candidates to take on the chief executive’s role, but there’s still no sign of Graham Kerr leaving the miner’s C-Suite.
Court sends Clive back to his swamp
Clive Palmer’s interminable efforts to get clear of prosecution over alleged breaches of the takeovers code were unceremoniously swatted aside by the Federal Court.