UPDATED: 11 September, 2pm.
Dairy company Brancourts has gone into administration due to current challenges being faced through a combination of high milk prices and the company’s inability to reflect these increased costs in its end products.
Bradley Tonks, Mark Roufeil & Simon Thorn of PKF Australia have been appointed administrators.
In a statement to Food & Drink Business, the administrators said: “The sales and manufacturing arm of Brancourts has been put into Voluntary Administration. The business continues to trade with customers as the Administrators assess formal restructuring options to place the business back on a sustainable footing. We have also received a number of enquiries from interested parties looking to buy the business as a going concern and are advancing those discussions.”
The dairy business employs more than 100 people. It has processing plants in Hexham, NSW, and Traralgon, Victoria and a head office in Sydney.
In a statement PKF said that while the business is still trading, 50 staff from the manufacturing team were stood down on Friday. The remaining staff are covering customer relations, logistics and reduced production activity to fulfil orders from available stock.
PKF said Brancourt Dairy continues to trade with customers, although production has been significantly wound back to the point of only final stage production. They are working with Brancourt Dairy’s key customers, from supermarkets to other food manufacturers, to fulfil orders from available stock as a priority.
The Administrators are urgently pursuing options for a sale of the business as a going concern, as well as looking at formal restructuring options for the business. They also intend to run an "efficient and transparent process" to see a "thorough and impartial investigation" of the events and actions that have brought Brancourt Dairy to this position
Around 50 of Brancourt Dairy’s manufacturing staff have been stood down, with the remaining staff maintaining customer relations, logistics and reduced production activity
Brancourt Dairy market share numbers include:
- 30% (estimated figure) market share of the Japanese market for Sweetened condensed milk (SCM) products.
- 60% of the cottage cheese market share in Australia (estimated figure).
- 50% of SCM market share in Australia (estimated figure).
Details of the first meeting of creditors will be advised to creditors in the coming days.
PKF expects employee entitlements will be met either through a sale of the business, recoveries from the sale of stock, or through the Commonwealth Government’s Fair Entitlements Guarantee (FEG) Scheme.