The number of companies falling into administration across England and Wales ticked up over the third quarter of 2017.
Analysis by KPMG of notices in the London Gazette shows that the number of companies entering administration increased from 297 in the third quarter of the year to 302 in the third quarter. This is also an increased when compared to the same period last year (Q3 2016) which saw 295 corporate insolvencies.
Blair Nimmo, head of restructuring at KPMG, commented: “Since the middle of 2016, we’ve seen a fairly steady rate of companies falling into insolvency, with quarterly figures typically hovering around the 300 mark. While this is very much reflective of the benign economic climate we’ve seen in the UK over the last 18 months, here at KPMG we have started to see an increase in the number of conversations we’re having with businesses around performance improvement and turnaround strategies.”
Blair Nimmo continued: “Following a challenging time for retailers over the first six months of the year, it appears the sector steadied over the summer, although all eyes will now be turning to their performance over their busiest and most important final quarter of the year. Sectors that do appear to have undergone a degree of stress over the quarter include building and construction, manufacturing and interestingly, companies who offer recruitment and temporary manpower services – perhaps emblematic of the low unemployment rate currently seen across the UK economy.
“Looking ahead, uncertainty in a broader sense may leave a negative impression on consumer and corporate confidence. The weak exchange rate may take its toll on certain sectors, interest rates have finally seen their first rise in over a decade and inflation is at its highest level in five years. It will therefore be interesting to see whether the next couple of quarters start to witness a more stark increase in corporate failures.”
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