Nearly £70bn was owed to creditors in the second quarter of 2010 according
to Begbies Traynor’s Red Flag statics.
The Begbies Red Flag data monitors early signs of companies in financial
difficulty broken down on a quarterly basis.
The report estimates £69.5bn is owed to creditors from the 127,000 companies
in financial difficulty in the second quarter. However, the number of companies
in financial distress fell by 21% compared to Q1 2010.
The average debt of each troubled business climbed to £545,000 in Q2 2010
compared with £340,000 in Q1 this year.
According to the Red Flag report the latest figures suggest large companies
are now experiencing difficulties, potentially threatening further job losses.
Although company liquidations and administrations declined over the last
three consecutively quarters, according to statistics issued by the Insolvency
Service, Begbies Traynor expects the number of corporate insolvencies to
increase in the second half of 2011.
“We are concerned that the levels of business distress will increase again,
potentially from the first half of 2011, once the full effects of the coalition
government’s fiscal tightening measures impact the economy and particularly
amongst those private sector businesses most dependent on public sector
contracts,” said Ric Traynor executive chairman of Begbies Traynor.
The second largest improvement in ‘significant’ levels of financial distress since the EU Referendum was in professional services, found research from Begbies Traynor
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The EC has been instructed to draft a European Union (EU) directive authorising an EU financial transaction tax, which would apply to ten of the EU’s 28 member states
Steve Absolom and Will Wright from KPMG Restructuring have been appointed joint administrators to City Motor Holdings and associated companies