Press releases

Services industry sees increased corporate insolvencies in Q1 2016

Construction insolvencies begin to decrease

Overall, number of insolvencies in Q1 2016 remains steady in comparison with same quarter in 2015

The service industry recorded the most corporate insolvencies in the first quarter of 2016, with 74 appointments, according to the latest figures released today by Deloitte, and published on This represents a 131% increase on the same quarter in 2015, and accounts for 29% of all insolvencies in Q1 2016.

Overall, the figures show that there were 251 corporate insolvencies in the first quarter of this year. This represents an increase of just one when compared with the same quarter last year, and may be an indication that the number of corporate insolvencies in Ireland are beginning to level out. In recent years, the highest number of insolvencies recorded in the first quarter of the year was in 2012 when there were 433 appointments.

The analysis shows that the construction industry recorded the second highest level of appointments with 42 (17%). The retail, hospitality and manufacturing industries had 13%, 8% and 7% of the appointments respectively, with the balance coming from other sectors.

David Van Dessel, Partner in Deloitte Restructuring Services, commented: “In previous years, the construction industry consistently had the largest number of insolvency appointments and it wasn’t until 2015 that the service industry overtook it for most appointments recorded. This indicates that while the level of insolvencies in the construction industry aren’t at the peak levels seen since 2009 the level of corporate failure in this industry is only now starting to slow down. It also demonstrates the delayed effect that the crash of the construction industry is having on other sectors, in this case the service industry, where the shockwaves are only now being felt.

“Overall, this quarter’s results indicate that we may be entering a period where the total number of corporate insolvencies begins to level out somewhat. Albeit quite early in the year, we expect the level of corporate insolvency appointments for 2016 be slightly lower than the total recorded in 2015. While we aren’t yet observing the low levels of insolvencies recorded during the so-called Celtic Tiger years, it may be that those particularly low numbers seen in 2007 and 2008 were outliers themselves and the levels recorded in 2015 and so far in 2016 are a more realistic baseline to compare future levels to.”

Types of insolvencies

Of the 251 corporate insolvencies, creditors’ voluntary liquidations accounted for the vast majority, with 173 recorded in the period (69%). This is consistent with both the same period last year where creditors’ voluntary liquidations accounted for 71% of total insolvencies.

Receiverships accounted for 64 (25%) of the total corporate insolvencies in Q1 2016, up from the 55 in the same period last year (Q1 2014).

There were 12 court liquidator appointments in the current period, down by only one from the same period last year. Approximately 42% of these cases the Revenue Commissioners took the petition to wind up.

Examinerships continue to remain at disappointingly low levels. Q1 2016 saw only two examiners appointed out of the 251 corporate insolvencies, less than 1%. This level of examinership take-up is consistent with the comparable periods and shows that the introduction of new legislation in early 2014 has not had the intended effect of encouraging more struggling SMEs to avail of this more cost-effective and accessible option.

Geographic breakdown

The highest number of corporate insolvencies in the period was recorded in Leinster with 68% of total appointments. This is consistent with the same period last year where Leinster had approximately 60% of all corporate insolvency appointments. In the current period Munster had 21% of appointments, Connaught 7%, and Ulster just 4% - again consistent with the same period last year.

David Van Dessel, Partner in Deloitte Restructuring Services concluded: “The low level of examinership take-up needs to be addressed urgently. Many viable businesses could be saved with this option. Critical to this is raising awareness of the advantage of this process in addition to the need for company directors to take early action when faced with financial difficulties – we urge them to take remedial action before it is too late to save their businesses.

“The fact that most corporate insolvencies are recorded in Dublin shouldn’t come as a surprise as business activity is concentrated in this region. For the same reason, economic recovery is most strongly seen in the Dublin area but shouldn’t necessarily be assumed to be occurring at the same pace in other areas around the country.”

For Further Information Please Contact

Aoibheann O’Sullivan
Murray Consultants
01 498 0300

Claire Quinn
Corporate Communications Manager
01 417 2356

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