Failed bakery leaves behind mountain of debt (and pies)
A GOLD Coast bakery that crumpled has left behind debts of more than $5 million to employees and creditors and stock, including frozen pies, croissants and doughnuts, worth nearly $50,000.
Australian Artisan Bakery Pty Ltd, which traded as KCs Bakery in Molendinar, also had pie and sausage roll making machinery worth $1.039 million at the time directors Mark Gabites and Daniel Pardy decided to wind up the failing company.
The pair opted for a creditors' voluntary liquidation - which is where a company cannot pay its creditors in full and is insolvent - on March 25.
KCs Bakery has been making meat pies, sausage rolls and cakes on the Coast since 1995.
The business was taken over by Australian Artisan Bakery in 2017 and ran into cashflow problems 18 months later.
A report by Michael Dullaway and Mark Davidson, of Bundall-based Pearce & Heers Insolvency Accountants, has revealed the full extent of the company's financial affairs.
It lists close to $800,000 owed to 123 employees, who are priority creditors, including $202,641 in wages and $269,470.88 in superannuation. Mr Pardy and Mr Gabites are both owed $598.50 in superannuation contributions, according to the report.
They are also major creditors of the company, owed $145,128 and $122,264, out of a total of $4.503 million due to 78 companies.
The other major creditors comprise the Australian Taxation Office ($885,013), Scottish Pacific ($166,197), Commonwealth Bank ($1.554 million), Colliers ($190,683) and Demos A & Mikael ($457,500).
Australian Artisan Bakery is itself owed a substantial slice of money with $350,687 outstanding from 207 entities, including schools, clubs and bakeries across the Gold Coast and Brisbane.
The biggest outstanding amounts come from 7-Eleven ($37,436), Coles ($30,668), Metcash ($35,649), Spar Australia Ltd ($21,390) and Superior Food Service ($85,400).
The company had a large amount of stock in the freezer at the time of the closure.
Products included 15 boxes of frozen lamb and rosemary pies selling for $115.92 each, five boxes of frozen sausage rolls (24 in each) selling for $38.42 per box and 62 boxes of pink iced doughnuts (32 in each) selling for $37.15 per unit.
The stock is worth a total of $47,282 according to the liquidators. Machinery, which will be sold along with stock to repay debt and creditors, is reportedly worth $1.039 million.
It includes a Seton pie/sausage roll line bought in 2005 for $60,500, now worth $18,000, and a Rykaart shortbread sheeter bought for $18,182 in 2010 and now worth $8300.
Another report from the liquidators lists a deficit of $3.935 million, after allowing for cash in the bank and the value of machinery and stock.
Records show Australian Artisan Bakery had $100,190 paid on share capital issued.
The landlord for the former KCs Bakery premises at 6 Depot Court is currently seeking a tenant for the vacant space. The 4580sq m property contains a building with a net lettable area of 1952sq m.
It includes a food production area, cool rooms, freezers, blast chillers and dry storage space. There is also a shopfront on the ground floor and offices on the first level.
The leasing agent is Commercial 1 Gold Coast's Steve Macgregor.