14% rise in company insolvency rate over the last quarter in NI
THERE was a 14% increase in the number of companies here entering insolvency between July and September this year, new figures have shown.
However, the Insolvency Service statistics revealed a sharp drop in the number of personal insolvencies during the third quarter of 2018.
The 65 company insolvencies between July and September included 30 compulsory liquidations and 24 creditors’ voluntary liquidations. The latter category was up from 14 in the same quarter last year.
There were six administrations, four company voluntary arrangements and one administrative receivership.
McErlain’s Bakery was among the companies entering administration. The Magherafelt firm behind Genesis Crafty went into administration on August 21, owing at least £4.3m to its creditors.
The process triggered a prepack sale to Tayto boss Paul Allen’s company Hatch Brothers,
for £1.85m. The sale saved 260 jobs, but left around 200 unsecured creditors out of pocket, with some owed six-figure sums.
And in July, barbecued food chain Bubbacue closed its two Belfast venues after a creditors’ voluntary liquidation.
Ian Davison from business advisory firm Grant Thornton said given the size of the local economy, the figures did not raise undue concern: “That said, some sectors are facing challenges and we are seeing these particularly in the construction, retail and food services industries. This is highlighted by recent research which indicated that one in four UK businesses have suffered as a result of the insolvency of a customer or supplier within the last six months.
“The fact that there are limited corporate insolvencies is a positive sign for the resilience of our local economy, despite continued sluggish growth.”
There were 536 individual insolvencies here over the last three months, a drop of 21.6%.
The number includes 112 bankruptcies, a 30.9% drop on last year, reflecting a general downward trend in since the end of 2016 when the minimum debt a creditor must be owed to make someone bankrupt increased from £750 to £5,000.
There were 313 individual voluntary arrangements (IVAs) recorded between July and September, 23.5% down on the third quarter of 2017.
IVAs involve repaying creditors some or all of what they are owed.
Debt relief orders, now offered to people on low incomes owing less than £20,000, numbered 111 over the quarter.