Nottingham, 19 January 2010 — The financial health of businesses in the UK saw a significant improvement in 2009, while the annual rate of business insolvencies[1] increased at a slower rate compared to 2008, according to the latest Insolvency Index from Experian®, the global information services company.
The average financial strength score[2] for businesses in Great Britain improved steadily throughout 2009 – rising from 79.46 in January 2009 to 81.37 in December 2009. According to Experian, this has been helped by an overall improvement in the time it takes businesses to pay their suppliers.
Despite peaking in the year in the first half of 2009, the sharp fall in business failures during the second half of the year helped alleviate the final number of insolvencies in 2009. Total insolvencies increased by only 12.0 per cent during 2009, compared to the 29.3 per cent increase during 2008, bringing the annual insolvency rate for 2009 to 1.25 per cent.
In addition, during December the rate of business insolvencies was 0.11 per cent, lower than the 0.12 per cent recorded in the same month the previous year (December 2008).
Rolf Hickmann, Managing Director of pH, an Experian company, said: “In 2009 businesses in Great Britain managed to climb back to a better place financially.
“Last year, it became clear that the businesses most successful at avoiding insolvency were the very smallest and the very largest ones. The highest insolvency rates in 2009 were among mid range businesses.
“Many more businesses are taking steps to protect themselves from the risks of not getting paid, the impact on them if a key supplier or customer goes bust and indeed the risk of insolvency within their own businesses. With this in mind, businesses need to not only proceed with caution when it comes to both new and existing business clients, but also ensure that their own house in order, so that they themselves are appealing prospects for business.”
Key highlights for 2009, included:
|
Region |
Insolvencies Dec 09 |
% change from Dec 08 |
% of business population failing Dec 09 |
% of business population failing Dec 08 |
Financial Strength Score Dec 09 |
Financial Strength Score Dec 08 |
|
Scotland |
82 |
18.8 |
0.07% |
0.06% |
81.31 |
80.40 |
|
North East |
74 |
-14.0 |
0.19% |
0.22% |
81.43 |
79.46 |
|
North West |
228 |
-13.3 |
0.12% |
0.14% |
80.63 |
79.01 |
|
Yorkshire |
160 |
-31.6 |
0.14% |
0.18% |
81.48 |
79.27 |
|
Wales |
56 |
-17.6 |
0.10% |
0.12% |
80.91 |
79.19 |
|
West Midlands |
203 |
-0.5 |
0.13% |
0.13% |
80.28 |
78.64 |
|
East Midlands |
137 |
-11.0 |
0.13% |
0.14% |
81.81 |
79.81 |
|
Eastern |
162 |
-21.7 |
0.09% |
0.12% |
82.41 |
80.79 |
|
South West |
144 |
-5.9 |
0.09% |
0.10% |
82.87 |
81.49 |
|
Greater London |
546 |
-0.7 |
0.11% |
0.11% |
80.25 |
78.01 |
|
South East |
298 |
-21.2 |
0.09% |
0.10% |
82.63 |
80.93 |
|
Grand Total |
2,090 |
-11.7 |
0.11% |
0.12% |
81.37 |
79.57 |
Source: pH, an Experian company
|
Number of employees |
Insolvencies Dec 09 |
% change from Dec 08 |
% of business population failing Dec 09 |
% of business population failing Dec 08 |
Financial Strength Score Dec 09 |
Financial Strength Score Dec 08 |
|
1-2 |
281 |
2.2 |
0.07% |
0.07% |
82.63 |
80.52 |
|
3-5 |
356 |
-10.6 |
0.16% |
0.16% |
82.22 |
81.50 |
|
6-10 |
302 |
-5.3 |
0.23% |
0.24% |
81.56 |
80.73 |
|
11-25 |
292 |
-3.3 |
0.29% |
0.29% |
81.19 |
80.75 |
|
26-50 |
105 |
-29.5 |
0.22% |
0.30% |
80.66 |
80.40 |
|
51-100 |
70 |
-10.3 |
0.26% |
0.28% |
80.20 |
79.92 |
|
101-500 |
35 |
-53.9 |
0.13% |
0.28% |
81.27 |
81.14 |
|
501+ |
15 |
-53.1 |
0.16% |
0.34% |
84.38 |
84.65 |
|
Unspecified |
634 |
-14.0 |
0.07% |
0.07% |
80.66 |
78.32 |
|
Grand Total |
2,090 |
-11.7 |
0.11% |
0.12% |
81.37 |
79.57 |
Source: pH, an Experian company
|
Sector |
Insolvencies Dec 09 |
% change from Dec 08 |
% of business population failing Dec 09 |
% of business population failing Dec 08 |
Financial Strength Score Dec 09 |
Financial Strength Score Dec 08 |
|
Extractive Industries |
1 |
-66.7 |
0.07% |
0.20% |
82.93 |
81.98 |
|
Oil |
2 |
-33.3 |
0.06% |
0.09% |
86.52 |
84.61 |
|
Building and Construction |
325 |
-0.9 |
0.20% |
0.21% |
78.27 |
77.45 |
|
Building Materials |
5 |
-44.4 |
0.13% |
0.24% |
79.82 |
79.55 |
|
Chemicals Industry |
5 |
-28.6 |
0.18% |
0.24% |
81.54 |
80.99 |
|
Diversified Industrials |
44 |
-35.3 |
0.20% |
0.30% |
78.45 |
77.77 |
|
Electricals |
16 |
23.1 |
0.18% |
0.14% |
79.67 |
78.97 |
|
Engineering |
75 |
-6.3 |
0.20% |
0.21% |
79.56 |
79.00 |
|
Printing, Paper and Packaging |
5 |
0.0 |
0.20% |
0.19% |
78.43 |
78.25 |
|
Textiles and Clothing |
28 |
-28.2 |
0.21% |
0.27% |
77.09 |
75.96 |
|
Breweries |
1 |
0.0 |
0.21% |
0.21% |
80.35 |
79.88 |
|
Spirits, Wine and Tobacco |
- |
#DIV/0! |
0.00% |
0.00% |
82.39 |
81.69 |
|
Food Manufacturing |
15 |
50.0 |
0.30% |
0.20% |
78.05 |
77.54 |
|
Pharmaceuticals |
1 |
-75.0 |
0.11% |
0.45% |
81.51 |
81.94 |
|
Wholesaling |
83 |
-30.8 |
0.13% |
0.18% |
80.10 |
79.25 |
|
Leisure and Hotels |
140 |
-4.1 |
0.17% |
0.17% |
79.25 |
76.55 |
|
Media |
77 |
-1.3 |
0.12% |
0.12% |
81.09 |
79.28 |
|
Food Retailing |
11 |
0.0 |
0.08% |
0.08% |
77.21 |
77.61 |
|
Non-Food Retailing |
100 |
-37.5 |
0.12% |
0.19% |
79.34 |
78.16 |
|
Servicing/Repair |
11 |
0.0 |
0.12% |
0.12% |
82.46 |
80.40 |
|
Transport |
83 |
-13.5 |
0.17% |
0.17% |
78.65 |
76.96 |
|
Utilities |
1 |
-75.0 |
0.05% |
0.22% |
80.74 |
79.76 |
|
Postal and Telecommunications |
14 |
-22.2 |
0.16% |
0.19% |
76.58 |
74.45 |
|
Agriculture, Forestry and Fishing |
6 |
-53.8 |
0.03% |
0.06% |
85.55 |
83.96 |
|
Banking and Financial Services |
94 |
-21.0 |
0.19% |
0.24% |
84.79 |
84.36 |
|
Health and Household |
- |
-100.0 |
0.00% |
0.45% |
79.75 |
78.66 |
|
Business Services |
491 |
-3.9 |
0.09% |
0.09% |
81.82 |
79.52 |
|
Hiring and Leasing |
38 |
72.7 |
0.29% |
0.16% |
81.47 |
79.03 |
|
Property |
144 |
-18.6 |
0.08% |
0.10% |
83.63 |
84.79 |
|
Other Services |
88 |
-9.3 |
0.05% |
0.06% |
85.81 |
83.87 |
|
Plastics & Rubber |
17 |
0.0 |
0.30% |
0.29% |
78.24 |
78.06 |
|
Insurance |
11 |
-8.3 |
0.09% |
0.10% |
84.89 |
84.94 |
|
IT |
79 |
-15.1 |
0.07% |
0.09% |
83.83 |
80.10 |
|
Motor Traders |
53 |
0.0 |
0.15% |
0.15% |
80.12 |
78.78 |
|
Unspecified |
26 |
-23.5 |
0.02% |
0.02% |
74.12 |
68.59 |
|
Grand total |
2,090 |
-11.7 |
0.11% |
0.12% |
81.37 |
79.57 |
Source: pH, an Experian company
Ms Serj Heera
0115 992 2773/07837 652169
serjeet.heera@uk.experian.comAbout 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.
For more information, visit http://www.experian.co.uk.
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.