Insolvencies worse than 2013

Company failure rate shows recovery remains fragile

Blair NimmoMore businesses are failing in Scotland than two years ago when the recovery began to take hold, suggesting that it remains fragile.

The number of insolvencies over three month and six month periods is down on last year, but up on 2013.

There were 402 insolvency appointments in the first half of 2015 against 369 in the same period in 2013, while the second quarter of 2015 witnessed 214 against 200 in 2013. This marked the end of the recession and slow climb back to growth.

Even so, data from KPMG shows a sharp spike in insolvencies last year. In the first six months in 2014 there were 479.

Nevertheless, Blair Nimmo (pictured), head of restructuring for KPMG in Scotland, said: “Despite some uncertainties, the overall picture remains positive for the majority of businesses in Scotland, most of whom are on a fairly stable footing and looking to the future with confidence.

“This is reflected by the overall downward trend in the number of corporate insolvency appointments made in 2015.

insolvency data 1

“That being said, the national figures mask ongoing challenges facing businesses in certain industries. Oil and gas continues to struggle – even as the price of oil begins to climb. The summer budget went some way to relieving the pressure on the industry but challenges remain and the next six to 12 months will be an indicator of the sector’s resilience.

“As well as those in oil and gas, our restructuring advisory and debt advisory practices are busy working with businesses across the food and drink, construction and care home sectors, of which issues relating to pension deficits, working capital management, cost reduction and refinancing remain a priority.”

Insolvency data 2

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