Commercial Equipment Hire
Rapid expansion during a market boom can leave businesses highly exposed when industry conditions reverse.
This case study explores how a well-established plant hire group with annual turnover of approximately $25M and a 12-branch network faced significant financial pressure following the downturn in the oil, gas, and mining sectors.
The business had expanded aggressively during the resources boom to capture increased market demand. However, when sector activity declined sharply, the group was left with elevated debt levels, falling equipment utilisation, declining revenue, and increasing pressure on cash flow.
As a result, the business recorded a net loss of approximately $1.5M and breached its banking facilities with its major financier. At the same time, the group faced an immediate working capital shortfall of approximately $2M.
Vantage Performance was engaged to conduct a strategic review of the group, assess restructuring options, and implement an urgent business stabilisation and turnaround plan.
Key initiatives included:
Development and execution of a business stabilisation strategy
Implementation of a working capital improvement program comprising approximately 47 initiatives totalling circa $7M
Strategic review and closure of underperforming branch locations
Reallocation of newer fleet assets across the remaining branch network to improve utilisation and operational efficiency
Sale of surplus plant and equipment assets to reduce debt and improve liquidity
Negotiation of a standstill agreement with the major financier
Securing of a 4-month equipment finance repayment holiday
Assistance to management in negotiating ATO, OSR, and creditor repayment arrangements
A key focus throughout the engagement was restoring financial stability while repositioning the business around a more sustainable operational footprint capable of supporting future growth.
The Outcome:
Successful stabilisation and restructuring of the business
EBITDA improvement from approximately $1.5M to $5.5M in FY17
Restoration of operational and financial performance
Opening of two new branches following the turnaround
Identification of further expansion opportunities
Preservation of approximately $10M in shareholder equity
Retention of around 80 jobs across the business
The project wasn’t simply about downsizing, it was about strategically repositioning the business to improve utilisation, strengthen cash flow, and create a sustainable platform for future growth.
This is where Vantage Performance operates: helping businesses navigate market disruption, restructuring, and strategic turnaround through disciplined execution and operational leadership.
Learn more: vantageperformance.com.au
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