Creditors face €1bn losses as 1,100 firms go into liquidation this year
Published 30/08/2010 | 05:00
MORE than €1bn in unpaid debt has been left behind so far this year by companies in liquidation, a new survey has revealed.
Vision-net.ie, the business intelligence and risk agency surveyed more than 100,000 companies and found that at least one third are at risk of failure.
High-risk businesses are those deemed to be performing badly on a number of key business ratios. These include deteriorating liquidity, reduced or negative cash flow, lower sales or profits and significant interest repayment burdens.
So far this year, more than 1,100 companies have gone into liquidation. The construction, finance services and retail sector have been hardest hit. And the number of high-risk companies in the hospitality/restaurant sector has risen.
Companies that started-up within the last 10-years are facing the greatest trading difficulties.
Christine Cullen of vision-net.ie said: "Thousands of suppliers who are owed money by these companies are now left battling it out at creditor meetings fighting for a share. If they are lucky, the likelihood is that they will only receive a small fraction of the money which is owed to them.''
More than 38,000 companies that appeared to be normal could, in fact, be in trouble.