REVEALED: JMK cashflow concerns months before collapse
JM KELLY Group were holding "high level discussions" with advisors KordaMentha about "cash flow difficulties" and trading performance as early as August, according to the first creditor report issued by PwC.
The Morning Bulletin was given a copy of the report, which was issued to creditors on Friday, October 19.
JM Kelly Group, one of the region's biggest building firms, announced on Wednesday, October 17 it would go into voluntary administration, putting at least 230 people out of work.
The Queensland Building and Construction Commission (QBCC) will re-commence action to strip director John Murphy of his building licence.
Tradies walked off site at the Aldi construction site on Gladstone Rd on Wednesday following the announcement, but there were several people seen at the site again yesterday.
However, the first creditor report reveals administrators PricewaterhouseCoopers (PwC) were contacted on August 27 by financial advisors KordaMentha on behalf of JM Kelly Group.
The report states this discussion was about "the possibility of taking an appointment as Voluntary Administrator or Liquidator of various Group companies".
"The meeting on 27 August 2018 involved high level discussions regarding the Group's recent trading performance, issues contributing to its current cash flow difficulties and the structure of the Group," the report stated.
On September 10, the directors met with PwC where KordaMentha indicated they were in discussion with the secured creditor and awaiting a decision regarding ongoing legal action with the QBCC.
In the week prior to October 17, KordaMentha contacted PwC several times to advise of developments and likely appointment.
PwC met with JM Kelly Group and KordaMentha on October 15 to provide an update, but there was no specific advice in relation to their circumstances.
NAB, Commonwealth Bank of Australia, BOQ Equipment Finance and ANZ banks are listed as secured creditors.
The first creditor meeting will be held at The Leichhardt Hotel on Monday, October 29 at 10am.