news release
Nottingham , 22 November 2010 - The latest Insolvency Index from Experian®, the global information services company, has revealed a significant year-on-year drop in business insolvencies during October.
1,635 UK businesses failed last month, 17 per cent fewer than the 1,976 insolvencies recorded in October 2009. This equates to an insolvency rate (1) of 0.08 per cent of the business population in October 2010, compared to 0.10 per cent the year before, and generally reflects the long term improvement in insolvencies.
Although at 81.00, the financial strength score (2) of UK businesses in October was marginally lower than the 81.14 recorded in October 2009 and also when compared to last month (81.05), the overall trend shows a general upward trajectory since May this year.
Max Firth, Managing Principal of pH, an Experian company, said: “It is encouraging that the business population in general is faring better in terms of insolvencies than this time last year, despite mid-market failures increasing in October. It remains key for organisations to ensure that they use data insight to help them understand and manage the risks in today’s marketplace.”
Summary of other key findings:
· All regions saw year-on-year falls in insolvency rates, with Scotland again regaining its position as the region with the lowest rate of insolvencies (0.05 per cent).
· Yorkshire and the North East (the regions with the highest insolvency rate in Oct 2009) saw the biggest improvements with insolvency rates dropping over the last year. 0.11 per cent of businesses in the North East failed in October 2010, compared to 0.14 per cent in October 2009, while Yorkshire saw rates decline from 0.15 per cent to 0.07 per cent.
· Greater London continues to be the region where businesses had the lowest financial strength score at 79.83.
· The largest companies saw the biggest improvement to the insolvency rate with it dropping to 0.10 per cent from 0.16 per cent last October.
· The mid-sized companies, those with 51-100 or more employees, were the only businesses to see an annual increase, with the insolvency rate leaping to 0.24 per cent from 0.19 per cent in 2009.
· Only 10 out of the 35 industries saw an improvement in their financial strength with the leisure and hotel industry leading the rise from 78.76 in October 2009 to 79.29 – the biggest improvement of any sector.
· Businesses in the oil industry held the highest financial strength score during October – 85.86, with Food retailers at the opposite end of the spectrum with lowest score of 75.49.
Region |
Insolvencies October 10 |
Insolvencies October 09 |
% of business population failing October 10 |
% of business population failing October 09 |
Financial Strength Score October 10 |
Financial Strength Score October 09 |
Scotland |
64 |
72 |
0.05% |
0.06% |
80.81 |
81.11 |
North East |
43 |
55 |
0.11% |
0.14% |
81.22 |
81.12 |
North West |
219 |
239 |
0.11% |
0.13% |
80.45 |
80.56 |
Yorkshire |
126 |
179 |
0.10% |
0.15% |
81.04 |
81.25 |
Wales |
50 |
57 |
0.09% |
0.10% |
80.60 |
80.60 |
West Midlands |
183 |
205 |
0.11% |
0.13% |
80.12 |
80.03 |
East Midlands |
92 |
114 |
0.08% |
0.11% |
81.37 |
81.54 |
Eastern |
141 |
154 |
0.08% |
0.09% |
81.90 |
82.19 |
South West |
104 |
113 |
0.07% |
0.07% |
82.69 |
82.55 |
Greater London |
392 |
501 |
0.08% |
0.10% |
79.83 |
79.98 |
South East |
221 |
287 |
0.07% |
0.09% |
82.17 |
82.43 |
Grand Total |
1,635 |
1,976 |
0.08% |
0.10% |
81.00 |
81.14 |
Source: pH, an Experian company
Number of employees |
Insolvencies October 10 |
Insolvencies October 09 |
% of business population failing October 10 |
% of business population failing October 09 |
Financial Strength Score October 10 |
Financial Strength Score October 09 |
1-2 |
223 |
248 |
0.05% |
0.06% |
82.25 |
82.23 |
3-5 |
255 |
311 |
0.11% |
0.14% |
81.86 |
81.84 |
6-10 |
222 |
288 |
0.17% |
0.22% |
81.41 |
81.43 |
11-25 |
240 |
295 |
0.23% |
0.29% |
81.16 |
81.17 |
26-50 |
105 |
136 |
0.22% |
0.28% |
81.09 |
81.19 |
51-100 |
64 |
51 |
0.24% |
0.19% |
80.92 |
81.05 |
101-500 |
46 |
57 |
0.17% |
0.22% |
82.09 |
82.28 |
501+ |
9 |
15 |
0.10% |
0.16% |
84.63 |
84.87 |
Unspecified |
471 |
575 |
0.05% |
0.06% |
80.21 |
80.12 |
Grand Total |
1,635 |
1,976 |
0.08% |
0.10% |
81.05 |
81.00 |
Source: pH, an Experian company
Sector |
Insolvencies October 10 |
Insolvencies October 09 |
% of business population failing October 10 |
% of business population failing October 09 |
Financial Strength Score October 10 |
Financial Strength Score October 09 |
Extractive Industries |
1 |
3 |
0.21% |
0.07% |
82.44 |
82.86 |
Oil |
1 |
5 |
0.03% |
0.24% |
85.86 |
86.23 |
Building and Construction |
235 |
290 |
0.16% |
0.23% |
77.49 |
78.15 |
Building Materials |
6 |
11 |
0.16% |
0.27% |
79.81 |
79.95 |
Chemicals Industry |
6 |
6 |
0.18% |
0.10% |
81.80 |
81.72 |
Diversified Industrials |
35 |
51 |
0.17% |
0.22% |
77.91 |
78.47 |
Electricals |
10 |
14 |
0.13% |
0.23% |
79.24 |
79.79 |
Engineering |
75 |
95 |
0.14% |
0.20% |
79.39 |
79.75 |
Printing, Paper and Packaging |
3 |
4 |
0.17% |
0.48% |
78.67 |
78.85 |
Textiles and Clothing |
18 |
21 |
0.18% |
0.37% |
76.42 |
77.23 |
Breweries |
2 |
1 |
0.00% |
0.42% |
79.49 |
80.25 |
Spirits, Wine and Tobacco |
- |
1 |
0.00% |
0.00% |
82.68 |
82.24 |
Food Manufacturing |
10 |
15 |
0.03% |
0.02% |
77.98 |
78.29 |
Pharmaceuticals |
2 |
2 |
0.08% |
0.00% |
81.84 |
81.81 |
Wholesaling |
94 |
118 |
0.13% |
0.17% |
79.76 |
80.16 |
Leisure and Hotels |
127 |
144 |
0.13% |
0.15% |
79.28 |
78.76 |
Media |
65 |
70 |
0.08% |
0.11% |
80.56 |
80.91 |
Food Retailing |
14 |
13 |
0.07% |
0.05% |
75.49 |
77.62 |
Non-Food Retailing |
90 |
109 |
0.11% |
0.17% |
78.78 |
79.34 |
Servicing/Repair |
8 |
13 |
0.06% |
0.06% |
82.25 |
82.07 |
Transport |
70 |
68 |
0.11% |
0.13% |
78.42 |
78.36 |
Utilities |
1 |
1 |
0.00% |
0.21% |
79.67 |
80.92 |
Postal and Telecommunications |
8 |
11 |
0.18% |
0.25% |
76.20 |
76.46 |
Agriculture, Forestry and Fishing |
9 |
12 |
0.03% |
0.06% |
85.05 |
85.28 |
Banking and Financial Services |
67 |
93 |
0.13% |
0.12% |
83.95 |
84.96 |
Health and Household |
- |
2 |
0.00% |
0.00% |
79.05 |
79.87 |
Business Services |
374 |
413 |
0.07% |
0.10% |
81.44 |
81.48 |
Hiring and Leasing |
25 |
21 |
0.10% |
0.16% |
81.53 |
81.02 |
Property |
68 |
110 |
0.05% |
0.10% |
82.34 |
83.82 |
Other Services |
82 |
90 |
0.03% |
0.07% |
85.88 |
85.51 |
Plastics & Rubber |
16 |
13 |
0.09% |
0.33% |
78.06 |
78.52 |
Insurance |
6 |
18 |
0.13% |
0.13% |
84.22 |
85.14 |
IT |
58 |
78 |
0.05% |
0.07% |
83.45 |
83.35 |
Motor Traders |
32 |
43 |
0.10% |
0.14% |
80.12 |
79.94 |
Unspecified |
17 |
17 |
0.01% |
0.02% |
75.29 |
73.02 |
Grand total |
1,635 |
1,976 |
0.08% |
0.12% |
81.00 |
81.14 |
Source: pH, an Experian company
Ms Serj Heera
PR Manager
0115 992 2773/07837 652169
About Experian
Experian is the leading global information services company, providing data and analytical tools to clients in more than 90 countries. The company helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score, and protect against identity theft.
Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended 31 March 2010 was $3.9 billion. Experian employs approximately 15,000 people in 40 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; Costa Mesa, California; and São Paulo, Brazil.
For more information, visit http://www.experianplc.com.
(1) The insolvency rate is calculated by comparing the number of businesses that failed with the total business population in Great Britain.
(2) The financial strength score predicts the likelihood of a business failing in the next 12 months, with 100 being the least likely to default and 1 being the most likely.