Demolitions company Interdemo collapses as construction industry braces for more pain
Thursday, February 7, 2013/
A business specialising in interior stripouts and controlled demolitions has been placed in liquidation, as the construction industry continues to record a large number of corporate insolvencies.
Recent figures from the Australian Industry Group show the construction industry recently experienced its 31st consecutive month of contraction for home building. Insolvency experts have repeatedly said construction companies are among the most common collapses.
Interdemo, which was established in 2000 as a detailed demolitions and interior stripouts business, has now been placed in liquidation with Ernst & Young appointed. Partners Simon Cathro and Philip Campbell-Wilson were contacted by SmartCompany, but were unavailable prior to publication.
Interdemo managing director Simon Brown was also contacted, but was unavailable.
The business, which has a turnover of $2 million, markets itself as a key consultant for demolition projects ranging in size, noting key relationships with major construction companies. Interdemo provides demolition, concrete cutting, removals and occupational health and safety audits among its services.
Ernst & Young is seeking expressions of interest for Interdemo’s assets, including the trading name, plant and equipment and vehicles.
While Ernst & Young has provided no background regarding the liquidation, Housing Industry Association chief economist Harley Dale says the construction industry in general is still suffering.
“The general feel here is that conditions are still very weak overall,” he says.
“There are admittedly tentative signs 2013 will be a better year than in 2012, but of course at this point in time what happened in 2012 is still pretty fresh in terms of business profitability and viability.”
The construction industry has been almost at a standstill in many parts of the country, as demand for housing drops. One key exception is in Victoria, where apartment construction has kept plenty of SMEs busy.
But in areas such as south-east Queensland, the work has dried up.
“If you’re trying to recover from that kind of starting point, you know then inevitably it’s going to be a tough business environment starting in 2013,” says Dale.
The last year in particular has been a poor one for construction firms. In 2012 one of the largest construction firms in the country, Hastie Group, was placed in administration – although the company’s main cause for collapse was a $20 million fraud.
Dale says the next year may not be any different.
“I would suspect trading conditions are going to continue to be challenging for some time, particularly given signs of a recovery are so far what you’d call tentative rather than compelling.”
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