Debts to tradespeople and suppliers by collapsed builder National Buildplan Group have blown out to $58 million but administrators say they are likely to recoup only cents in the dollar.
The company, which had seven offices and 180 staff in NSW, Queensland and Western Australia, was placed into administration in early April. The collapse halted work on more than 30 projects in those states, many for state governments.
The latest report to creditors by administrator BRI Ferrier paints a grim picture of the final months for the family-owned group, which posted a $2.39 million profit in 2011-12 before racking up a $6.28 million loss in the next nine months. The report identified a massive discrepancy between director William Wheeler's estimate of the company's financial position and what administrators found: "The director's [report] indicates a surplus of $121,617 before administration costs. However, our analysis of the company's asset and liability position as at the date of our appointment indicates ... deficiency of $48,931,561 before costs."
The administrators blamed Buildplan's collapse on "inaccurate estimate of costs", "poor quality control", "poor tender", "poor project management", weather delays and problems with subcontractors.
The preliminary investigation found that although the company showed "signs of insolvency" around December 2012, administrators did not believe Mr Wheeler allowed it to trade while insolvent. "In early 2013, the company started to book unrealised losses on six projects," said BRI director Costa Nicodemou.
"I don't think, from the records I've seen, that they went into those contracts trying to get the skinniest margin possible. I think it's more a case of things that have happened post being awarded those contracts."
About 1000 unconfirmed claims have so far been lodged against Buildplan, with debts to unsecured creditors now potentially more than three times the original estimates.
The debt - up to $57.9 million owed to trade creditors and $3.2 million to employees - is despite the company tendering statutory declarations to the NSW government in the weeks before the administration stating all legal entitlements had been paid to subcontractors and employees.
BRI estimates priority creditors (employees) could recoup all their money. However, unsecured creditors - mostly tradespeople and suppliers - can expect a return of 0.08¢ to 5.6¢ in the dollar.
Creditors are due to vote on the company's future in Sydney on May 30.