PERTH, AUSTRALIA - Australia's largest manufacturer of polyurethane and polystyrene products, Perth-based Joyce Corp. Ltd., has entered receivership.
The company has three divisions: Joyce Foam Products, Joyce Healthcare and Joyce Rural. Joyce Corp. Chairman Dan Smetana said the company owed A$30 million (US$15.7 million) to suppliers and A$30 million to its main creditors. The creditors, a pair of Australian banks, on May 4 appointed receivers Barry Honey and Robyn McKern of accounting firm KPMG Australia.
Although Joyce reported a profit of A$268,000 (US$140,300) for the half year ended Dec. 31, receivers were concerned with Joyce's limited cash flow.
The company is moving ahead with plans to sell a foam plant in Melbourne, which is expected to generate A$7 million (US$3.6 million). The sale, to Perth-based hardware retailer Bunnings Ltd., will be finalized in June.
Joyce bought the Melbourne property last year, plus plants in Sydney and Brisbane, to increase its foam manufacturing capabilities. After a review, the company decided to sell the Melbourne plant but keep the other two. Joyce also has foam manufacturing plants in Perth and Adelaide.
Despite the sale, Smetana said Joyce had no plans to scale back its foam division. He said Joyce felt it was ``an appropriate time'' to review the division, which had operated under the same structure for several years.
``It has been and will continue to be the core focus of our attention, but with a receiver, we are not in control.''
Smetana said Joyce expects to survive the reorganization. Joyce makes flexible PU foam products for furniture and bedding, autos, industrial applications, sound suppression and consumer products. Its PS division makes molded PS storage boxes and PS in sheet and block form.