The latest insolvency statistics, that cover April to June 2019, have been released. And the figures have revealed that company insolvencies have once again increased overall, when compared to Q1 2019.
There were 4,321 company insolvencies over the three months, which is 11.9% higher than the same quarter in 2018. It’s actually the highest underlying level of insolvencies of any quarter since Q1 2014.
Driven by CVLs
According to the statistics, this further rise in company insolvencies was mainly driven by an increase in Creditors Voluntary Liquidations (CVLs) across Q2. They had risen by 6.9%, and made up 70.4% of all corporate insolvency events.
While other insolvency mechanisms such as Company Voluntary Arrangements (CVAs) saw a slight decrease.
Compulsory Liquidations, CVAs and Administrations
The stats also revealed that when compared to Q1 this year:
- CVAs fell by 1.1%.
- Compulsory Liquidations fell by 4.1%.
- Administrations fell by 11.4%.
These figures suggest that despite high profile CVAs being seen in the media, amongst some major high street names, they are still a very underutilised option in corporate insolvency, accounting for just 2.1% of all insolvencies.
Increase in underlying insolvencies
The statistics show that for the fifth consecutive quarter, the rate of company liquidations has continued to rise. With the 12 months ending Q2 2019 showing an extra 97 underlying company insolvencies, when compared to 12 months ending Q1 2019.
It appears that the accommodation and food service industry has been the main driver of this increase, with an extra 74 cases, indicating an increase of 3.4%.
The struggling construction industry saw a 1.2% increase, with 37 additional company insolvencies. In fact, the industry had the highest number of new company insolvencies In the 12 months ending Q1 2019, with 3,100 cases.
Is your company in financial trouble?
If your company can no longer pay its debts and is suffering from some serious cash flow problems, it’s vital that you seek professional advice from your Accountant and / or a Licensed Insolvency Practitioner.
At Clarke Bell, we have the experience and expertise to accurately assess your situation, offering FREE tailored advice as to the best options available to you, such as:
- Liaising (informally) with your creditors to give you some breathing space.
- a Company Voluntary Arrangement (CVA).
- a Creditors’ Voluntary Liquidation (CVL).
- a pre-pack Administration.
Contact our friendly team today, on 0161 907 4044 or [email protected]