Fewer large companies fail in September

Scotland maintains lowest regional insolvency rate

Nottingham UK, 23rd October 2011 - The latest Insolvency Index from Experian® has revealed that the largest companies in the UK – those employing 501 or more employees – experienced a year on year fall in the number of insolvencies during September.  Just 11 large firms failed in September 2011, 25 per cent fewer than the same period in 2010.

Across the entire UK business population, the rate of insolvencies increased. 0.09 per cent of British businesses failed in September, up from 0.08 per cent in September last year. The insolvency rate is calculated by comparing the number of businesses that failed with the total business population in Great Britain.

The average financial strength score1 for UK businesses fell for the seventh consecutive month, to 78.80 in September, compared to 81.05 in September 2010. However, large companies saw their financial strength score improve from 84.63 to 85.87.

Micro businesses employing just one or two people experienced the biggest annual rise in insolvencies during September, increasing by 25 per cent to 258. This represented 0.06 per cent of the UK’s total business population.

Although the North East of England saw the biggest drop in its failure rate from 0.15 per cent to 0.13 per cent, it remained the region with the highest rate of insolvencies. Scotland maintained the lowest insolvency rate with 0.07 per cent, while the West Midlands witnessed the biggest rate increase from 0.08 per cent in September 2010 to 0.11 per cent in September 2011.

Oil companies remained the strongest in September 2011 with a financial strength score of 84.21 while food retailers were the worst performing with a score of 73.76.

Max Firth, Managing Director of Experian Business Information Services in the UK & Ireland, said: “While larger businesses bucked the trend in September, our analysis underlines how important it is that companies understand the financial strength of their customers, suppliers and business partners. This kind of accessible and valuable insight can make all the difference to a business of any size. ”

1The 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.


 

Region

Insolvencies
Sept-11

% change from
Sept-10

% of business population failing
Sept-11

% of business population failing
Sept-10

Financial Strength Score
Sept-11

Financial Strength Score
Sept-10

Scotland

 78

-6.02

0.07%

0.07%

     79.78

     80.89

North East

 55

-8.33

0.13%

0.15%

     79.79

     81.25

North West

 196

-3.92

0.10%

0.11%

     78.28

     80.50

Yorkshire

 123

2.50

0.10%

0.10%

     78.90

     81.11

Wales

 63

26.00

0.11%

0.09%

     79.02

     80.66

West Midlands

 170

29.77

0.11%

0.08%

     78.26

     80.18

East Midlands

 92

-4.17

0.08%

0.09%

     79.61

     81.40

Eastern

 140

26.13

0.08%

0.06%

     79.91

     81.94

South West

 135

29.81

0.09%

0.07%

     81.08

     82.74

Greater London

 430

15.90

0.09%

0.08%

     76.56

     79.87

South East

 250

6.84

0.08%

0.07%

     80.13

     82.22

Grand Total

 1,732

10.74

0.09%

0.08%

     78.80

     81.05

Source: pH, an Experian company

Number of employees

Insolvencies
Sept-11

% change from
Sept-10

% of business population failing
Sept-11

% of business population failing
Sept-10

Financial Strength Score
Sept-11

Financial Strength Score
Sept-10

1-2

 258

25.85

0.06%

0.05%

     82.26

     82.25

3-5

 288

12.50

0.13%

0.12%

     81.34

     81.86

6-10

 213

3.40

0.16%

0.16%

     81.26

     81.41

11-25

 205

-12.39

0.20%

0.23%

     81.22

     81.16

26-50

 110

11.11

0.23%

0.21%

     81.18

     81.09

51-100

 41

-10.87

0.15%

0.17%

     81.17

     80.92

101-500

 39

8.33

0.15%

0.14%

     82.41

     82.09

501+

 11

-26.67

0.12%

0.16%

     85.87

     84.63

Unspecified

 567

21.41

0.06%

0.05%

     75.66

     80.21

Grand Total

 1,732

10.74

0.09%

0.08%

     78.80

     81.05

Source: pH, an Experian company

Sector

Insolvencies
Sept-11

% change from
Sept-10

% of business population failing
Sept-11

% of business population failing
Sept-10

Financial Strength Score
Sept-11

Financial Strength Score
Sept-10

Extractive Industries

 1

0.00

0.07%

0.07%

 80.50

 82.54

Oil

 2

0.00

0.07%

0.00%

 84.21

 85.88

Building & Construction

 280

7.69

0.17%

0.16%

 76.40

 77.58

Building Materials

 6

-25.00

0.16%

0.21%

 78.67

 79.84

Chemicals Industry

 1

-50.00

0.04%

0.07%

 80.65

 81.92

Diversified Industrials

 32

0.00

0.15%

0.15%

 76.95

 77.95

Electricals

 6

-50.00

0.07%

0.13%

 78.60

 79.22

Engineering

 62

37.78

0.16%

0.11%

 78.75

 79.41

Printing, Paper & Packaging

 7

0.00

0.21%

0.23%

 78.20

 78.59

Textiles & Clothing

 29

70.59

0.20%

0.12%

 75.11

 76.46

Breweries

 3

50.00

0.63%

0.42%

 76.63

 79.68

Spirits, Wine & Tobacco

 -  

-100.00

0.00%

0.21%

 80.44

 82.70

Food Manufacturing

 6

100.00

0.09%

0.05%

 76.84

 77.94

Pharmaceuticals

 -  

-100.00

0.00%

0.49%

 81.90

 81.71

Wholesaling

 75

22.95

0.12%

0.10%

 78.57

 79.76

Leisure & Hotels

 109

-3.54

0.12%

0.13%

 77.61

 79.35

Media

 58

-20.55

0.09%

0.11%

 78.88

 80.59

Food Retailing

 21

75.00

0.13%

0.08%

 73.76

 75.68

Non-Food Retailing

 100

35.14

0.12%

0.09%

 77.22

 78.84

Servicing / Repair

 4

-33.33

0.05%

0.08%

 81.33

 82.13

Transport

 51

-19.05

0.10%

0.12%

 77.39

 78.44

Utilities

 2

100.00

0.08%

0.05%

 76.37

 79.63

Postal & Telecommunications

 10

0.00

0.12%

0.12%

 74.41

 76.34

Agriculture, Forestry & Fishing

 7

75.00

0.03%

0.02%

 83.84

 85.04

Banking & Financial Services

 68

4.62

0.13%

0.12%

 82.42

 83.96

Health & Household

 1

0.00

0.12%

0.00%

 77.91

 79.30

Business Services

 418

20.11

0.08%

0.06%

 78.67

 81.44

Hiring & Leasing

 20

33.33

0.15%

0.11%

 80.80

 81.55

Property

 110

29.41

0.07%

0.06%

 80.59

 82.41

Other Services

 101

0.00

0.05%

0.05%

 83.81

 85.91

Plastics & Rubber

 7

-12.50

0.10%

0.12%

 77.54

 78.13

Insurance

 5

-58.33

0.04%

0.10%

 82.93

 84.18

IT

 53

-20.90

0.05%

0.06%

 81.02

 83.52

Motor Traders

 41

10.81

0.11%

0.10%

 79.04

 80.09

Unspecified

 36

176.92

0.03%

0.01%

 67.33

 75.47

Grand total

 1,732

10.74

0.09%

0.08%

 78.80

 81.05

Source: pH, an Experian company

ENDS

Contact:

Chantal Heckford / Jennifer Comerford / Duncan Skehens
Lansons Communications
020 7490 8828
chantalh@lansons.com / jenniferc@lansons.com / duncans@lansons.com

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