Four companies are going bust every day
Tuesday May 04 2010
Four businesses went bust every day in April, according to InsolvencyJournal.ie, a website run by Dublin insolvency firm Kavanagh Fennell.
There was a 27pc rise in the number of companies declaring insolvency during the first four months of the year -- 532 companies compared with 419 for the same period last year.
However, there was some good news, with a slight drop in the number of insolvencies for the month of April, down to 125 companies compared with a total of 147 in March.
Ken Fennell, a partner with Kavanagh Fennell, said it was too early to say whether the decline in failures indicates an improvement in the economy or whether it's just a seasonal dip in figures.
"The number of insolvencies per month is still a cause of concern, with four companies going bust per day. The construction industry continues to be the worst affected. The first tranche of loans have now been transferred to NAMA so it will be particularly interesting to monitor the levels of construction insolvencies in the coming months," he said.
Positive
Dublin companies accounted for 42pc of the insolvencies. All industries, except for the motor trade and manufacturing, recorded a decrease in the number of insolvencies declared.
Once again the construction industry was the worst affected, with 39 building firms going out of business.
On a positive note, the motor industry is still benefiting from the introduction of the car- scrappage scheme announced in December's budget.
There were only eight insolvencies in the motor trade in the first four months of the year compared with 15 for the same period last year.
There were also some signs that the retail sector is stabilising, with insolvencies dropping by over 29pc from March to April. But retail insolvencies for the year to date are still 24pc higher than the same period last year. Eight manufacturing firms went bust in April compared to 11 in March.
Mr Fennell said the February total was the second highest monthly total for insolvencies after December 2009. If the trend continues, total insolvencies this year could exceed the 1,406 insolvencies recorded in 2009, Mr Fennell said.
Following a number of high- profile examinerships in February and March, including property and oil group Black Shore Holdings, Jackie Skelly Fitness and fashion chain Vera Moda -- Future Print was the only company to enter court protection in April.
However, the number of examinerships, the process by which firms seek court protection from creditors as they try to agree a plan to rescue the company, remains similar to those recorded over the past two years, with even companies entering examinership compared to 10 in 2009
- Maeve Dineen
Irish Independent
