Another two construction companies in Queensland have gone to the wall in recent days owing $4.5 million to creditors.
This news comes on the back of figures released by ASIC detailing 2832 construction industry insolvencies over the last financial year, up 28% on the previous FY which clocked up 2213.
Last week Gold Coast companies PPS Commercial and PPS Qld, based at Burleigh Heads and founded in 2003, were placed into liquidation after they had stopped trading, leaving a number of unfinished projects.
PPS Commercial is believed to owe $2.7 million while PPS Qld is in the red for $1.8 million to creditors, many being suppliers, subcontractors and employees.
The main reason provided by the directors for both companies was “adverse trading conditions in the construction industry,” liquidator Nick Keramos told the Gold Coast Bulletin.
Earlier in July the AFR reported that unprofitable building contracts, cost blowouts, planning delays, labour shortages, red tape, and the unwillingness of clients to agree to contract variations were among the key factors for construction companies going insolvent.
According to ASIC figures, the construction industry is by far ahead of other industries for companies currently going bust.
While there were nearly 3000 insolvencies over the last FY, the rate had slowed down in June with only 120 in the first two weeks compared with 314 in May and 255 in April 2024, providing potential hope.
Commonwealth Bank’s business banking head Mike Vacy-Lyle expressed some optimism, the AFR reported.
“We are seeing a little bit of stability return. I think that number will probably come off with time.”
About the author
Desi Corbett
Desi is the Editor of Concrete in Australia and at the helm of our magazine for 8 years. She was behind the Institute's weekly news bulletins from 2016-2021 and is now writing our focused news items. Desi has been an engineering news and features journalist/editor across all disciplines since 2013 - part of a 30-year career writing for a wide range of industries.