An outpouring of community support has saved South-Australian based food processor Spring Gully from going out of business, with the business announcing it is now debt-free after four-and-a-half-years of financial trouble.
The family-owned business went into voluntary administration in early 2013 with $4.9 million in debts after sales suddenly took a nose-dive, but after making its position public South Australians flocked to supermarkets to empty the shelves of its preservative spreads.
With revenue on the up, Spring Gully managing director Kevin Webb entered into a deed of company arrangement (DOCA) with creditors to pay them off while continuing to trade, an agreement he has now finalised.
Webb said he was relieved that the “most traumatic” period in the company’s history was over, thanking the South Australian public for their support.
“It means Spring Gully can look to the future with confidence. Our key aims throughout the DOCA was to make sure our creditors, who have been incredibly supportive of us, were paid in full,” Webb said..
Webb paid creditors, with interest, “thank them for their support and also for agreeing to changes to the original repayment schedule. Those same creditors have also continued to trade with us as normal over that four and a half years.”
Now that debts are repaid Spring Gully is looking to the future, with plans in the works to modernise and expand its factory, while considering the development of new products.
Spring Gully’s administrator, Austin Taylor of Meertens Chartered Accountants, said Spring Gully had been a classic example of how Voluntary Administration could provide safe harbour for companies facing financial difficulty.
“The termination of the DOCA is a testament to the resilience and determination of this remarkable family business,” he said. “It would have been easy for the families behind the business to give up, but they worked hard and once again are taking full control of their future.”
