FIVE IRISH COMPANIES went out of business every day last month – and half of those stress-tested showed signs they were on the brink of failure – according to the latest figures from a leading credit and risk analyst.
Vision-net’s figures showed that between 1 – 25 July 131 companies were declared insolvent (down 15 per cent on the same month last year).
Of those, 97 were liquidated, 33 entered receivership, and one had an examiner appointed.
Some 9,428 Irish companies were also stress-tested and 49 per cent were found to be at high risk of failure. According to the analysis, businesses in the hospitality, construction, IT, motor, and wholesale and retail sectors were least likely to survive.
There was a drop in company and business start-ups in July (2,750) when compared with the same period in 2011 (2,871). While professional services accounted for almost one-quarter of these new businesses, the same sector recorded an equal number of business failures.
According to their latest filed accounts, 101 companies that held meetings of creditors last month owed their short-term creditors more than €37 million. In July 2010, 118 companies held meetings of creditors.
The figures show that 345 registered commercial and consumer judgements worth €27.5 million were awarded in the courts – with 241 of these being judgements awarded against consumers worth €25.3 million. Credit unions, Revenue Commissioners and banks topped the list of plaintiffs.
The Revenue Commissioners accounted for 19 of the 104 commercial judgements recorded in the courts this month, followed by professional services businesses and local authorities.
The average value of a judgement increased 76 per cent on last July to €79,610.
Christine Cullen, Managing Director of Vision-net, said the figures show that recovery in the domestic economy remains slow: ‘The trading conditions remain very challenging for companies, with many of them, particularly those in the hospitality and construction sectors, struggling to stay afloat as consumer demand remains weak and the property market continues to stagnate.”
“High levels of unpaid debt and cash flow problems are hampering the capacity of companies to stay in business or scale and this has a knock-on impact on jobs and growth,” she said.