Mid-Sized Companies Struggling

Mid-sized companies suffered a year-on-year increase in the number of corporate insolvencies in October, despite a decrease in failure rates across all UK regions, according to new figures.

The latest Insolvency Index from Experian revealed that 1,635 UK businesses failed last month, which was 17% fewer than in October 2009, when 1,976 businesses became insolvent.

Of that total, mid-sized companies with 51 to 100 or more employees were the only businesses to see an annual increase, with the insolvency rate leaping to 0.24 per cent from 0.19 per cent in 2009.

Elsewhere all UK regions saw year-on-year falls in corporate insolvency rates, but despite the relative recovery only 10 out of the 35 industries saw an improvement in their financial strength, with the leisure and hotel industry demonstrating the biggest improvement of any sector.

Managing principal of pH Max Firth, said, “It is encouraging that the business population in general is faring better in terms of insolvencies than this time last year, despite mid-market failures increasing in October.”

Despite the improvement, the business services industry remained the worst affected, with 374 businesses becoming insolvent in October this year compared to 413 a year ago.

This was followed by the construction industry where 235 insolvencies occurred in the last month compared with 290 in October last year.

Yorkshire and the north east saw the biggest improvements in insolvency rates over the last year, with 0.11% of businesses in the north east failing in October 2010, compared to 0.14% in October 2009, while Yorkshire saw rates decline to 0.07% from 0.15%. Incidentally, these were also the regions with the highest insolvency rate in October 2009

Posted at 04:33PM Nov 24, 2010 by Marc Stenton in Insolvency  |  Comments[0]