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Companies tallying economic hit from bushfires
Tue 7 January 2020 - 11:38 amNews
Accommodation provider Aspen Group has forecast an income hit of at least $500,000 as bushfires wreak havoc on the NSW south coast and drive holidaymakers away.
The company is the latest in a growing number of businesses to have reported financial losses from fires in recent weeks, including fruit and vegetable grower Costa Group and Kangaroo Island Plantation Timbers.
Bega Cheese, which has two sites at Bega in NSW, on Monday said its facilities had not been damaged but employees and suppliers had been affected, with a further loss of shares.
Bushfires in Kangaroo Island have significantly impacted its tourism industry, destroying businesses such as the Southern Ocean Lodge.
Bushfires have also devastated business in smaller towns such as Mogo where the Roman Leathergoods store was destroyed.
The Council of Small Business Organisations Australia (COSBOA) said “The loss of infrastructure…will cause great difficulties for business folk and their employees, and communities, for years to come, unless the repair process commences now.”
Aspen’s properties have not been damaged by fire, although business at its NSW south coast properties – Barlings Beach and Tween Waters – had been impacted.
COSBOA said “Businesses have been opening all hours, often providing free meals and support and their employees have volunteered to work long hours as well.”
COSBOA has called for recovery task forces at federal and state level to have “the federal small business Ombudsman and state small business commissioners included to ensure full coverage.”
Aspen told the share market it expected revenue and net operating income from the two properties to be impacted by at least $500,000.
“The longer term impacts are difficult to predict given the considerable damage to the region including loss of houses and businesses,” Aspen’s market update said.
Insurance could recover some of the losses, according to the business.
Peter Strong, CEO of COSBOA, said “We need action now, people, business people in particular, need to see and hear that governments are not waiting for the fires to disappear before doing anything but are meeting now, consulting now, developing plans now.
Insurer IAG on Friday said it expects to pay out roughly $400 million in natural peril claims for the six months to December 31, more than half of its $641 million natural peril allowance for the fiscal year.
The insurance giant said it had received over 2,800 bushfire related claims since the beginning of September, mostly related to residential properties, including 1,500 claims since the start of December.
Insurance claims from businesses and properties affected by the fires are only expected to grow.
You can read more about how the bushfires have affected business here.
- January 16 2020 COSBOA push for policy adaptation that protects businesses affected by national disasters
- January 15 2020 Banking Code still not protecting small businesses fully
- January 8 2020 Interest-free loans for bushfire businesses
- January 7 2020 Companies tallying economic hit from bushfires