Hooters goes bust after radio station sends bill

Of the three Hooters restaurants to have opened in Australia, one has closed down and liquidators are searching for buyers for the other two, which are still trading. According to company documents, parent company Wings-Aus Holdings had debts of $4.85 million and had just $163,700 in realisable assets.

http://www.news.com.au
July 20, 2009

Hooters goes bust after radio station sends bill

* Hooters' parent company being wound up
* $6000 debt to radio station triggered failure
* Debts amounted to more than $8.4 million

Hooters.jpg

Bust…the parent company of Hooters has gone into liquidation with $4.8m in debts. Brett Faulkner

HOOTERS Girls will have to look for a new employer after poor management and a small advertising bill from radio station Triple M forced its Australian parent company to go bust.

The parent company of the famous eatery chain in Australia, which a NSW Supreme Court Justice described as "casual beach-theme restaurants", has been placed into liquidation with more than $4.8 million in debts.

Among the debts is a $5995 bill to Triple M Sydney for radio advertising which tipped the holding company into failure, the liquidator says.

The station is currently seeking a court order to receive the money.

Hooters restaurants are famous for their buxom and skimpily dressed female staff.

The wait staff are formally known as "Hooters Girls".

The company's website describes the eateries as "a fun and casual dining restaurant with a great atmosphere, delicious steaks… ice cold beer, sports on television and the only place you'll find the 'nearly world famous' Hooters Girls!"

Of the three Hooters restaurants to have opened in Australia, one has closed down and liquidators are searching for buyers for the other two, which are still trading.

According to company documents, parent company Wings-Aus Holdings had debts of $4.85 million and had just $163,700 in realisable assets.

Liquidator Murray Godfrey from RMG Partners told the Australian Securities and Investments Commission (ASIC) that "poor strategic management" caused the company's problems.

Inadequate cash flow, high cash use and poor economic conditions also led to the liquidation, Mr Godfrey said.

He told news.com.au that while the debt to Triple M led to the company being wound up, it wasn’t Wings-Aus' biggest problem.

"The company had been getting (financial) support from overseas," he said.

"But due to the economic conditions in the US, that was stopped."

The holding company was placed into liquidation in March after operating at a loss of almost $160,000 since July last year.

Its losses in recent years range from $1m to more than $1.5m.

Buyers are being sought for the two remaining restaurants in Parramatta, in Sydney's west, and the Gold Coast, which are still trading.

Another Sydney store was closed this year after recording annual losses of between $191,000 and $350,000 since opening in Cronulla in 2006.

http://www.news.com.au/business/story/0,27753,25808208-36437,00.html


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