Traffic group Evolution racks up losses of $26m as administrators appointed to key subsidiary

Brisbane’s Evolution Group has put another one of its subsidiaries into administration after racking up $26m in losses over two years due to Covid and weather disruptions.

Evolution continues to rack up heavy losses​

Troubled traffic control firm Evolution Group has put another one of its subsidiaries into administration after the parent company racked up losses of almost $26m over the last two years.

Brisbane-based Evolution, which is one of the largest traffic control companies in Australia and New Zealand, this week appointed FTI Consulting’s John Park, Joanne Dunn, and Kelly Trenfield as voluntary administrators of Evolution Traffic Management.

The moves comes after Evolution Group reported losses last financial year of $21m, compared to $4.9m in 2020, sparking a warning from auditors about the company’s future as a going concern.

Evolution Group chairman Kerry Daly told shareholders last year in its annual report that beyond Covid-19 business disruptions, “profitability remains constrained by insufficient working capital and expensive and restrictive debt levels, arising from an over-leveraged balance sheet.”

Evolution facing more losses

Administrators will conduct an independent assessment of the financial position and ongoing viability of Evolution Traffic Management including investigating a sale and recapitalisation.

In June 2020, Evolution Group put another one of its subsidiaries, Evolution Traffic Control, into administration with auditors earlier indicating the group’s large debt level could be unsustainable.

Evolution Group as a whole recorded $102.6m of revenues last financial year which represented a marginal increase on the prior year. Evolution Traffic Management recorded revenue of $65.2m.

However, profitability declined due to disruptions caused by Covid-19 related lockdowns, unseasonal weather events in Australia and New Zealand and a decline in margins due to balance sheet constraints.

SHIP AHOY

THIS week officially marks 10 years since Rodney Longhurst (illustrated) bought the struggling Gold Coast boat builder Riviera and turned it into one of Australia’s greatest export success stories.

Coinciding with the landmark date, Riviera on Friday hosted the world premiere of its 78 Motor Yacht – the largest production boat ever built in Australia and the crowning achievement of Longhurst’s success.

The 78 MY is the largest Riviera ever built – a $6 million boat for which Riviera has already received 12 orders.

In keeping with a ‘live like a millionaire’ theme, Longhurst anchored the 78 Motor Yacht at an isolated spot off South Stradbroke Island and flew in a media contingent via chopper from Marina Mirage to step aboard the 78 for the first time.

It has been a successful couple of years for Riviera, which now employs more than 800 people. Last year, the company reported profit had surged from $4.6m to $7.7m, according to financial reports lodged with ASIC.

Riviera owner Rodney Longhurst.

GOLD COASTING

ALMOST two years after Knight Frank closed its Gold Coast office the agency is headed back to the tourist strip

Knight Frank has engaged experienced NAI Harcourts’ operatives George Parzis and Abel Erasmus to head up their new Ferny Ave office at Surfers Paradise which is scheduled to start operating by the end of the month.

Knight Frank originally opened an office in Broadbeach in 2014 and lured the “dynamic duo” of the Gold Coast commercial property market – Mark Witheriff and Tania Moore – away from CBRE to head up the local operations.

Giving no explanation, the agency closed its Broadbeach office in April 2020 and 19 workers lost their jobs with Witheriff and Moore later returning to CBRE.

Knight Frank chief executive James Patterson says the Gold Coast office opening would kickstart Queensland expansion plans.

“South East Queensland is seeing a lot of investment, and while it already has a strong infrastructure pipeline, this will only be strengthened by the upcoming Olympic Games,” he said.

“George and Abel having many decades of experience in the real estate industry, across both sales, leasing and AMS, so they were an ideal fit to expand our business.

George Parzis