The administrator of collapsed custom publishing house Gadfly Media says he is confident that the business can be turned around, despite the fact the group is carrying debts incurred during the GFC.
Gadfly publishes a range of high-end magazines including Luxury Travel, Australian Art Collector and Breeding & Racing.
The company, which is run by sole director David Hickie, was placed in the hands of administrator Ian Purchas of RMG partners on February 25.
Purchas told SmartCompany that while the business has been trading well in recent months – and remains open for business as this stage – the administration was caused by a sharp drop in advertising during the GFC, particularly in the luxury and travel sectors.
“It was directly a result of debts incurred during the GFC when discretionary spending had decreased significantly,” Purchas says.
“It was been trading well recently but it has been struggling due to those problems suffered during the GFC.”
Purchas advertised the business for sale this morning. The group’s annual turnover is between $3.9 and $4.2 million and it has about 25 staff.
While Purchas says there has been some interest from parties who are keen to look at the business, it is more likely that a deed of company arrangement from the director will help Gadfly out of administration.
“The staff all appear to be supportive, the bank has agreed to work with us, the suppliers are supportive… I am fairly confident we will get a good result,” Purchas says.
Purchas is calling for expressions of interest in the business by March 16.
A second meeting of creditors will be held before April 1.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
