The event company which staged the ARIA Awards and Australian Grand Prix has folded, leaving creditors $6 million in the red.
The ES Group Australia, which has led a myriad of corporate and government events, turned over approximately $11 million last year. But after accruing “considerable” financial losses, the company has gone into administration, marking the end to 14 years of operation.
Mismanagement and “poor cost control” have been blamed for the collapse, which has reportedly left creditors $6 million out of pocket.
Fifteen employees have also been laid off, with approximately $195,000 owing in staff entitlements.
Administrator Giles Woodgate from Woodgate & Co explained that the collapse was a result of poor management, noting that the company was under “considerable” financial distress.
“The cause appears to be fundamentally bad management, poor cost control, excessive wages and salaries,” Woodgate told business publication, SmartCompany. “For the level of activity and for the way it was project orientated, the ES Group was undercapitalized.”
The ES Group was continuing projects with the Grand Prix and Opera Australia from February until April when the company announced its collapse. Opera Australia has since terminated its contract.
The company is no longer operating, but will meet with creditors later this week to discuss future arrangements.
Mojo Barriers, Packard Trading, Butlers Events and Opera Australia are among the major creditors.
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