Total number of corporate insolvencies levelling out in H1 2016; however services industry sees 93% increase
510 insolvencies in H1 2016
Statistics from H1 2016 suggest that overall corporate insolvencies may be levelling out in Ireland. The number of appointments in H1 2016 totalled 510, a 3% decrease on the same period in 2015.
- The service industry, which recorded the most insolvencies in H1 2016 with 135 appointments, saw a 93% increase on the same period last year and represents 26% of this period’s total
- The construction industry recorded the second highest level of appointments with 89 (17%). This is an increase of 46% from last quarter. The retail, hospitality and manufacturing industries had 11%, 10% and 7% of the appointments respectively with the balance coming from other industries.
- The highest number of corporate insolvencies in the period was recorded in Leinster with 67% of total appointments. Munster had 21% of appointments, Connaught 9%, and Ulster just 3%.
- Of the 510 corporate insolvencies, creditors’ voluntary liquidations accounted for the vast majority, with 313 recorded in the period (62%). Receiverships accounted for 165 (32%) of the total corporate insolvencies in H1 2016, up 27% on the same period last year. Additionally, there were 25 court liquidator appointments in the current period and just seven examinership appointments.
David van Dessel, Partner, Restructuring Services, Deloitte commented: “The large increase in receivership appointments represents an interesting change in the mix of insolvencies. However, despite this change, we are still not seeing an uptake in the levels of examinerships. The recent successful examinership of Druid’s Glen shows that where a business is viable, examinership is a key tool to promote survival and is a real proof point of the benefits of this option. For smaller SMEs there are still options to explore this type of restructuring through use of the “super-lite examinership” - the s.450 schemes of arrangement. Typically this is a less costly option that involves less court involvement but affords struggling companies a real chance at survival.”