Creditors hear first-hand the scale of JM Kelly debt
JM KELLY Group records indicate the company owes close to $19 million, with one sub-contractor sceptical he will be able to recover the $260,000 he is owed.
The high level of company debt was revealed during the first creditors meeting in Rockhampton today, where roughly 70 people gathered to learn the next steps in the administration process.
JM Kelly Group, one of Central Queensland's biggest building firms, announced on Wednesday, October 17 it was no longer able to trade.
PricewaterhouseCoopers (PwC) were appointed administrators and liquidators for various companies within the group, but there was no indication of the level of debt until today.
The Morning Bulletin was not able to attend the creditors meeting at the Leichhardt Hotel, but those in the meeting said they were advised that unsecured creditors (including subcontractors) amounted to $8.9 million and secured creditors $9.9 million.
Assets including debtors, plant and property was reported at a total of $9.9 million comprised of $2.9 million, $3 million and $4 million respectively.
Mike Vadasz, from Australasian Piling Queensland, is owed roughly $260,000 for work on the ALDI supermarket construction on Gladstone Rd.
Mr Vadasz spoke to media after the meeting, saying ALDI should pay subcontractors who had been left out of pocket by JM Kelly Group to foster goodwill in the community.
Doing otherwise, he said, would be a "PR disaster".
Mr Vadasz will not certify the piling works until he is paid, but said ALDI was attempting to find a third party who could circumvent this.
However, he is not holding out hope for payment from anyone but ALDI.
"I've been in the building industry for nearly half a century: we won't get any money, not through Kelly's, not through administration. It would have to be a miracle," he said.
"There are people just bleeding out there. It might be only four grand or 20 grand, but to a small subbie that's a lot of money.
"To me, I'm nearly 70, to use a quarter of a million is a heck of a lot of money."
Despite a move from creditors to appoint new administrators, PwC Australia partners Derrick Vickers and Michael Owen were retained as administrators.
They will continue to investigate the company's finances, and the debt figures are subject to further scrutiny.
PwC will prepare a detailed report for the second creditor meeting due on or before November 21.
This report will outline investigation findings and recommend the appropriate future actions for creditors' consideration.
An Expression of Interest campaign for several businesses within the company will continue.
"The Voluntary Administrators will continue to work with all stakeholders to determine the future prospects of JM Kelly Group entities and will move quickly to deliver the best possible outcome for creditors," Mr Vickers said.
When asked whether they were shopping for a new engineer to provide a Form 16 on piling works, ALDI directed The Morning Bulletin to a previous media release and the following statement: "In the coming weeks we will work as closely as possible with PwC to do what we can to ensure subcontractors are dealt with in a timely manner".