Five firms go bust daily over six months

ALMOST five companies have gone bust every day from January to June 2011, according to InsolvencyJournal.ie’s latest figures.

The report, compiled by insolvency and liquidation experts Kavanagh Fennell, recorded 819 insolvencies in the first six months of 2011, an increase of over 3% when compared with 792 for the same period in 2010.

The 2011 figures however, show a 32% increase when compared with the first six months of 2009 which totalled 622.

Kavanagh Fennell partner David Van Dessel said: “We are predicting the current rate to continue, with in the region of 1,600 corporate insolvencies for the calendar year 2011. That estimate is in line with 2010, which came in at over 1,500. If the economic climate was to worsen, for example through further increases in interest rates, the forecasted figure for 2011 might be viewed as being conservative.

“Looking back on our position at this time in 2010, our figures were indicating a 27% increase in corporate insolvencies; this time around the increase is just over 3%, which although it is not a decrease, would indicate a stabilisation in the incidence of corporate insolvencies.”

The construction industry was the worst affected, with 25% of the overall insolvencies. Retail’s 120 cases accounted for 15% of the total. Hospitality failures increased by 4% from 102 in 2010 to 106 in 2011, but the wholesale industry showed the biggest increase, rising from 17 in the first six months of 2010 to 41 in 2011, an increase of 141%.

Dublin continues to account for the majority of corporate insolvencies with a total of 304 (37%) of the total recorded for the first six months of 2011; this is followed by Cork with 73 (9%) of the national total. The county least effected was Longford recording only two insolvencies so far this year.

Meanwhile, these figures differed somewhat with the latest insolvency report released by Vision-net.ie, the business and credit risk service, whose figures suggest that eight Irish companies were declared insolvent every day for the same six-month period. Its calculations put it at odds with the InsolvencyJournal.ie report, with 1,008 the number of companies declared insolvent compared with 907 for the first six-months of last year.