Four companies going out of business each day
The number of companies in Ireland going out of business has continued to soar, with an average of four firms going bust every day between January and September, according to new insolvency figures.
Since the beginning of the year, 1,132 companies in Ireland went to the wall, with firms in the construction sector continuing to be hardest hit.
The number of companies that have gone bust so far this year is 12.5pc higher than the figure for the corresponding period in 2009, according to Insolvencyjournal.ie. However, despite the grim data, the firm said the figures also pointed to some stabilisation.
"It's the same four industry types -- construction, services, retail and hospitality -- being hit in the same ranking," said Ken Fennell, a partner in Kavanagh Fennell, the firm that compiles the data.
"But again, if we look at construction, the peak (of insolvencies) was 46 in February, and it's 42 in September, so insolvencies haven't got above that peak, and they have been pretty consistent since February."
The number of insolvencies during the third quarter of this year was 340, compared with 381 for the corresponding quarter in 2009. A total of 120 companies were declared insolvent last month.
Mr Fennell also predicted that about 1,500 companies were likely to go bust his year.
"The numbers for the entire year look as if they will be up slightly on last year, as we predicted at the start of the year. We're probably looking at somewhere around the 1,500 mark.
"The figures show that the trading environment is still challenging for businesses."
His comments came as an index showed yesterday that Ireland's manufacturing sector contracted last month for the first time since February as new orders dried up and companies shed jobs.
Last month, 43 construction-related companies failed, as well as 20 operating within the services sector.
Retailers also suffered, with 16 firms in the sector having been declared insolvent during the month, bringing the year-to-date tally to 140. Within the hospitality industry, 15 firms went bust last month.
Examiners were appointed to just two companies in September -- struggling airline Aer Arann and house builder McInerney Group -- compared with seven appointments made in September 2009.
"Companies are realising examinership is quite a difficult process to go through successfully," said Mr Fennell.
"A key criterion for a successful examinership is a scheme of arrangement to allow the company to trade as a going concern going forward. Current business conditions mean that this is difficult to obtain."
Receivers were appointed to 18 firms in September, bringing the total so far during 2010 to 173.