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Business failures spike

Over the past year, a wave of more than 5500 Australian companies hit the wall as many business owners succumbed to “sheer exhaustion.”

Background – business failures

The number of companies going into administration or liquidation topped 5560, according to Australian Securities and Investments Commission data.

NSW accounted for roughly 40 per cent, with 2177 companies going bust over the past 12 months. Victoria had 1236 insolvencies, followed by Queensland with 970, 432 in West Australia and 225 in South Australia.

Business failures increase

Revive Financial director Jarvis Archer said the Australian Taxation Office’s return to recovering tax debts after a two-year hiatus drove much of the increase in insolvencies.

“Director warning letters and director penalty notices triggered company directors to deal with their hefty tax debts that accrued during the pandemic,” said Mr Archer.

“What we’re seeing from struggling business owners at the moment is their sheer exhaustion. Often they’ve battled through the last two difficult years to end up in trading conditions even more hostile than the ones they’ve survived.”

Mr Archer said that, as well as the ATO, landlords needed to be more patient with businesses trying to recover from pandemic lockdowns and other government restrictions.

“Several businesses in my local Sunshine Coast area have had locks changed or closed the doors and walked away,” he said.

Sectors hit the hardest.

WCT Advisory managing partner Andrew Weatherley said the most significant number of insolvency appointments were within the construction industry, followed by accommodation, food, retail, and professional services.

Mr Weatherley said the collapse of several cryptocurrency platforms also had caught many people by surprise.

“The value of cryptocurrencies have been falling for several months and are volatile in general,” Mr Weatherley said.

“I think part of the problem seems to be how those entities have been operated and the steamroll effect on confidence in the industry.”

Mr Weatherley said he expected a steady increase in insolvency appointments in 2023 due to higher interest rates, inflation and energy prices. In addition. supply chain issues, staff shortages, and wage growth also will impact.

Mr Archer predicted more pain for the troubled construction sector in the coming year. Construction-related companies still represent one in four company insolvencies, compared to one in five pre-pandemic.

“There’s still a lot of stress in this space which is expected to crystallise in increased insolvencies in early 2023,” he said.

“Some have characterised the construction industry’s current state as a house of cards. The two key factors expected to play havoc for the industry in coming months are cashflow and licensing.”

While builders had started to pass on the price increases to clients, delays were still drawing out build times, and labour pricing was through the roof.

“Consequently, there’s still minimal margin in projects for builders who call this the profitless boom,” Mr Archer said.

The primary company collapsed in 2022


Gold Coast building giant Condev collapsed in March, owing more than $30m.

The firm, founded in 2002 by Steve and Tracy Marais, closed its doors after talks with developers about a $25m cash boost broke down, and the directors’ considered liquidation was the only option for the company.

Condev, which helped build much of the 2018 Commonwealth Games infrastructure, had 18 projects under construction in southeast Queensland, with 14 on the Gold Coast.

A Condev building site on the Gold Coast.


Oracle Homes

Almost 300 subbies and suppliers were left about $14m out of pocket following the collapse of Oracle Homes in August.

The firm’s failure also left 300 homes unfinished across Queensland and NSW and millions owed to an army of subcontractors, including plumbers, carpenters and bricklayers.

The Underwood-based company – which traded under several names, including Oracle Platinum Homes and Oracle Hunter Homes – made headlines earlier in the year when it sought tens of thousands of extra dollars from clients to complete their homes amid the deepening financial crisis in the construction sector.


TrigonX, a key sponsor of the Gold Coast Titans, owes creditors more than $73m, it was revealed after the cryptocurrency platform appointed administrators in December.

Trigon, the latest Queensland crypto trading firm to hit the wall following global giant FTX, collapsed amid the growing chaos in the market for bitcoin and other virtual currencies. It trades as TrigonX.

According to documents lodged with ASIC by administrators William Robson and William Cotter, King River Digital Assets is owed $31m, Pacifika Consortium $26m and ADG Digital $16m.


In November, Deliveroo Australia sacked 150 staff and kicked almost 12,000 restaurants and 14,500 riders off its platform after the British parent company pulled funding.

Deliveroo said the Australian operations were not profitable and could only continue with substantial financial investment to support the delivery platform.

Deliveroo Australia CEO Ed McManus told staff about the move to close the business late on Wednesday, with KordaMentha administrators appointed to manage the closure.

KordaMentha partners Craig Shepard, Andrew Knight and Michael Korda were appointed Deliveroo Australia’s voluntary administrators.

Mr Korda said Deliveroo was unable to achieve sufficient market share.


Probuild, one of the country’s largest construction companies, called in administrators in late February after it is South African parent said it would stop financially supporting the group.

Probuild, which employed thousands of workers around the country on significant construction projects in Brisbane, Sydney and Melbourne, including the global headquarters of pharmaceuticals giant CSL.

Revelations subcontractors owed millions were “left whistling in the wind” because of lack of payment protections led to former Master Builders Australia chief executive John Murray, who conducted a Federal Government inquiry four years ago into insolvency in the sector, to say more needed to be done.

Three of Australia’s largest banks and global insurance giants were also caught up in the collapse.

According to documents sent to creditors, ANZ and the Commonwealth Bank were significant actual or contingent creditors of parts of the Probuild empire. They also identified the NAB as a creditor of certain group entities.

Probuild’s parent company said, in hindsight, it would have pulled the pin earlier on the failed construction firm that went into administration owing $14m to workers and more to creditors.

South African parent company Wilson Bayly Holmes-Ovcon said the Australian business was “out of kilter” with the rest of the company, contributing around 60 per cent of WBHO’s revenue since 2017 but only minimally to the company’s profit. Over the four years, the Australian arm had $223m in material losses, mainly from the 443 Queen St apartment tower in Brisbane and the Western Road Upgrade Project in Melbourne. Losses in the current period in Australia were about $91m, it said at the time.

The content of this article’s intention is to provide a general guide to the subject matter. You should seek specialist advice about your specific circumstances.

Vogue Advisory Group – helping business owners navigate difficult times.

The after-effects of the Covid pandemic are filtering into 2023 for many companies. As uncountable business leaders learned at the pandemic’s peak, unexpected factors can significantly alter companies.

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Business Failure

business failures