Hawkers Beer has successfully emerged from voluntary administration under existing management after it started the process on 12 February.
The outcome was decided today after creditors unanimously signed the DOCA developed by DBA Reconstruction & Advisory in conjunction with Hawkers’ directors. The DOCA specified how Hawkers will financially restructure in order to remain profitable and resilient moving forwards.
“After a challenging period for the business, we are grateful that our restructuring proposal was unanimously approved,” said Mazen Hajjar, Founder and Managing Director at Hawkers.
“Through a challenging time for the business, we have been buoyed by the support of our customers and supply partners.”
Melbourne-based Hawkers is considered one of the largest and most esteemed independent breweries in the country. Worryingly, it encountered its financial problems despite reporting consistent growth in both its Hawkers and Rover brands over recent years. When beginning the process with administrators, Hajjar cited reasons such as increased production and distribution costs and the growth in craft beer ‘homebrands’ as catalysts for Hawkers’ debt.
“Post Covid has been a challenging period with bigger players increasingly restricting access to taps and shelf space, combined with broader economic pressures, including increased input costs and taxes,” he said.
Hawkers Beer has not suffered any changes or impacts to production and distribution lines as a result of the voluntary administration process.
“The administration process didn’t change the way we operated at all. Beer production and sales have not been impacted,” said Hajjar.
“After a challenging period for the business, we are grateful that our restructuring proposal was unanimously approved. Through a challenging time for the business, we have been buoyed by the support of our customers and supply partners.”
Golden West Brewing Co enters administration
In less positive news, Perth-based Golden West Brewing Co has collapsed and entered into voluntary administration. The news has been announced despite the brewery having achieved recent milestones such as a trophy at last year’s Perth Royal Beer Awards.
“The company had insufficient capital to continue trading,” said Mathieu Tribut, administrator, to Perth Now.
“It’s a sad story. No one is to blame and the boys did their best.”
While it appears there is little chance of Golden West returning under current management nor name, a company spokesperson has indicated that various parties had shown interest in purchasing the business with intentions of continuing operations as a new brewery.
What the Independent Brewers Association’s proposed to the Government
The IBA recently put forth six proposals to the Federal Government that aim to provide greater support to the 600+ independent breweries in Australia.
“Unless we get some relief from the federal government then we will see more businesses close and we will see more voluntary administrations and we will see more redundancies,” said Kylie Lethbridge, CEO of the Independent Brewers Association (IBA), in a recent Drinks Trade exclusive interview.
“Anybody that’s in the industry at the minute is looking at the next 12 to 18 months as still presenting some challenges. So, although some have seen that little bit of light at the end of the tunnel, it still looks like 2024 is going to be quite challenging.”
The first three proposals seek to provide immediate relief to Australia’s independent brewing industry and include:
- Freezing indexation of alcohol excise for a period of two years.
- The excise remission cap of $350,000 that was introduced in July 2021, should be indexed in line with inflation.
- Extending terms for repayment of excise debts that were deferred during the covid years.
“We are the tiniest part of the Australian [beer] market, but we employ over 51% of the industry because we’re quite labor intensive, and so the more breweries that close or restructure downward, the more jobs that are going to be lost in this country,” said Lethbridge.
“If we don’t get a little help, you’ll definitely see more of that pain.”
