Begbies issues full year results warning
Begbies issues results warning as number of company failures hits pre-recession low
INSOLVENCY MARKET bellwether Begbies Traynor Group has warned that its full year results will be below market expectations as a result of a decline in the number of corporate failures.
The number of UK corporate insolvencies in the first quarter of the year fell 11.3% compared to the same period last year and have sunk to their lowest level since the end of 2007, according to official figures from the Insolvency Service.
In a trading update, Begbies said overall UK corporate insolvency appointments for the year to 31 March 2015 – the period which most closely matches the firm’s financial year – were 16,380, representing a 14% year-on-year reduction.
The specialist business recovery practice said it had “maintained its market-leading position by number of appointments” and that its strategy of selected bolt-on acquisitions “only partially mitigated the impact of a declining market”.
Eddisons, the property consultancy it acquired for £8.5m last year, continues to perform in line with the firm’s expectations at the time of the acquisition, Begbies said.
“We have made good progress integrating Eddisons into the group and we are already starting to realise the synergies that the team’s expertise brings to the group’s core insolvency practice,” said Ric Traynor [pictured], executive chairman of Begbies.
The board said it is managing the group’s cost base to reflect lower levels of overall market activity, and that it continues to operate “comfortably” within its banking facilities.
“Whilst it is disappointing to have seen a further decline in the overall insolvency market in the UK, we have maintained our market-leading position and have taken action to align our cost base to current activity levels,” Traynor said.