Insolvency-related activity has risen slightly in the South East, says R3, the UK’s insolvency and restructuring trade body.
R3’s analysis of data provided by Creditsafe showed a slight increase in insolvency-related activities from 178 in July to 196 in August. These include administrator and liquidator appointments together with creditors’ meetings.
This number remains significantly lower than a year ago when 264 insolvency-related activities took place in the region in August 2023.
The findings also revealed the number of firms in liquidation that owed money to their creditors in the South East has dropped again from 310 in July to 298 in August.
The South East figure for insolvency-related activities remains the sixth highest in the UK, behind Greater London, which has 471, the North West 409, East Anglia 308, West Midlands 241 and Yorkshire & Humberside also 211.
Neil Stewart, chairman of R3’s Southern and Thames Valley region, explained that month-by-month fluctuating figures made it tricky to identify positive trends but that relative stability in regional insolvency-related activities over the summer was a good sign.
Neil said: “The traditional summer slowdown tends to intensify economic challenges, but this year’s summer of sport, including the Euros and Olympics and, at times, some good weather have helped to reduce the problem.
“There is also, following July’s General Election, a feeling of more stability for businesses and the likelihood of better trading conditions, especially for retail, hospitality and construction businesses.
“Government plans for 1.5 million new homes, reform of planning regulations and lifting of the ban on onshore wind farms will also give the construction sector – and its supply chain – a further lift but will take time to have any significant impact.”
R3’s Southern & Thames Valley region includes Kent, Surrey, Sussex, Buckinghamshire, Oxfordshire, Hampshire, the Isle of Wight, Dorset, Wiltshire and Berkshire.
Neil, a regional associate director at insolvency litigation financing company Manolete Partners Plc, added that ongoing economic challenges – pay settlements, cautious customer spending, extra costs, supply issues and poor cashflow management – may still be decisive.
He said: “More positively, an improved economic and business climate should also result in greater acceptance and success of rescue proposals, and businesses of various sizes are showing a growing interest in restructuring plans, which is encouraging news for the profession.
“Businesses across the South and Thames Valley must nevertheless continue to be on their guard and remain alert to signs of trouble. If difficulties are identified early enough options other than spiralling into insolvency will remain on the table.
“As we head into autumn, businesses that seek specialist advice might just find that recovery or restructuring is a creditable and possible alternative to insolvency.
“Hoping that the problem will go away or pumping more money into bad situations are unlikely to work. The answer is to move quickly and find a trusted, qualified and regulated advisor to help you find the best solution.”
The latest Creditsafe data shows a relatively static picture in the number of companies with invoices that had gone past their payment date, up slightly from 58,443 in July to 59,189 in August – this is the highest figure this year.
Meanwhile, the number of invoices which had gone past their due date in the region has risen from 510,252 in July to 520,801 in August.
The number of start-ups in the South East has decreased from July’s 5,558 to 5,110 in August. April’s 8,050 remains the highest monthly start-up figure since December 2021.
