Vantage Performance acted as the Interim Chief Executive Officer (CEO) and Chief Restructuring Officer (CRO) for this project.
A national mining services business with a yearly turnover of $36 million was the victim of a general downturn in the mining sector.
In 2012, their revenue decreased by half creating significant cash flow and operational issues.
As a result, the business had breached its banking facilities, faced significant tax and creditor arrears and required an immediate cash injection and restructure of its operations.
Matters were made worse by a lack of data integrity and poor transparency regarding their key business drivers. There was also a shortfall in working capital and the company had taken a temporary overdraft extension from $400,000 to $1.9 million which needed immediate attention.
How we turned things around.
Working with the company’s management, Vantage Performance implemented a business stabilisation plan and seconded two of our executives to act as the company’s interim CFO and General Manager. Their role was to restructure operations and improve financial reporting.
With these measures safely in place, we negotiated a 4-month finance payment holiday, reduced the company’s headcount by 60%, secured $4 million in creditor payment plans and negotiated favourably with the ATO.
The shareholders injected a further $400,000 and a $2 million de-stocking plan was brought in to boost cash flow.
Once the business was stabilised, the general agreement was that it should be sold.
Vantage Performance helped facilitate the sale by conducting an equity raise which attracted interest from 25 parties and 3 firm letters of offer.
The company was eventually sold to the RMA Group; a business which operates in 73 countries and which has a turnover in excess of one billion dollars.