With JobKeeper due to cease on 28 March 2021, leading restructuring adviser Mackay Goodwin is urging all businesses in crisis to seek help before the deadline, as it calls for the government to make special consideration for industries unable to resume normal business operations (travel, tourism and associated sectors).
This week Mackay Goodwin was appointed to Helloworld Monbulk/Bentleigh (VIC), which was placed into voluntary administration. Mackay Goodwin CEO Domenic Calabretta says he is worried it is only the first of many travel companies who will find themselves in a similar situation by the end of next month.
“Sadly, we know there will be more travel businesses experiencing hard times but acting now and seeking help means it won’t necessarily mean the end of the road.
“Unfortunately, some industries are still unable to return to business as usual after having their entire sector virtually wiped out by COVID-19. Other businesses, which may be on the path to recovery, will still need professional help once the Government rolls back its JobKeeper lifeline on 28 March.
“I urge the Government to find a solution for the most vulnerable industries which still can’t pick up their day-to-day operations due to ongoing restrictions. These industry sectors must be considered and treated separately to other industries.
“Affected companies will need at least four weeks to cover redundancy provisions for staff unless a solution or extension to JobKeeper is delivered, and many companies may fall at that hurdle. They must seek help now before the 28 March deadline.
“There are a couple of routes open to struggling travel businesses if they act early and as soon as possible,” he says. “The first step is to have a good handle on their financial position. There are several options available to affected businesses, including voluntary administration or a small business restructure.
“Impacted companies should seek help now, and not wait until JobKeeper dries up. Employee entitlements such as redundancies will need to be covered where a business may need to liquidate, so seeking help should give
companies the peace of mind that an experienced financial adviser is supporting them.”
