FOUR companies a day are going out of business with the number of insolvencies expected to hit an all-time record of more than 1,400 by the end of the year.
Figures from InsolvencyJournal.ie show 117 companies went bust last month, which is an increase on the previous two months.
The figure however is down 23% from the year high of 151 in July.
The last time the number came anywhere near this was last year when there were 773 insolvencies, according to InsolvencyJournal.ie.
Ken Fennell, partner with Kavanagh Fennell, the operators of InsolvencyJournal.ie, said the small increase in the past three months is not surprising as there is usually a peak in the last quarter. "The overall picture for 2009 remains bleak with a total of 1,326 firms declared insolvent so far this year. The average rate of monthly insolvencies stands at 121 companies per month. Should this continue, the total number will exceed our own predicted figure of 1,400 this year," he said.
The highest number were recorded in the construction industry but there was a 20% drop on the October figures, suggesting that the rate of insolvencies in the construction industry may have bottomed out. "There was no such reprieve for the services and hospitality industry, both of which recorded increases in company failures this month," he said.
The 25 services firms that went out of business last month brought the total number of insolvencies in this sector to 253 this year, second only to the construction industry where there were 394 to-date.
In the motor trade the number of companies declared insolvent jumped from one in October to six in November. "The figures will no doubt strengthen the Society of the Irish Motor Industry’s argument for the introduction of a scrappage scheme in the December budget," said Mr Fennell. The number of examinerships stayed the same, with only two companies applying for court protection in November. This, according to the Insolvency Journal suggests companies may be wary about the examinership process following the Zoe Group’s unsuccessful examinership bid in September.
November also saw a slight decrease in the number of insolvencies through receiverships, with the volume of receiverships down 45% from the year high of 22 in February.
a d v e r t i s e m e n t
This appeared in the printed version of the Irish Examiner Wednesday, December 02, 2009
