Overall UK business insolvency rate at lowest point since January 2010
Nottingham, 21 June 2010 – During May, the rate[1] of business insolvencies fell to its lowest point since January 2010, according to the latest Insolvency Index from Experian®, the global information services company. Experian’s latest analysis also reveals an 18.0 per cent fall in the total number of business insolvencies during May compared to April, bringing the rate of insolvencies down to 0.08 per cent from 0.10 per cent in April.
It also marks an improvement compared to May 2009 when the rate was 0.10 per cent.
Last month’s performance was due to a vast month-on-month and year-on-year improvement among medium sized businesses with 51 to 100 employees. These businesses, which have suffered some of the highest levels of insolvencies in the last two years, saw the rate of insolvencies fall from 0.24 per cent in April 2010 and 0.23 per cent in May 2009, to 0.13 per cent in May 2010 – the lowest point since September 2007.
The average financial strength score[2] of all UK businesses was up year-on-year, from 79.98 during May 2009 to 80.70 in May 2010, but it was down slightly on the 80.76 recorded in April 2010. Although a small decline, this was the third consecutive month-on-month decline in average financial strength score of all UK businesses.
Rolf Hickmann, Managing Director of pH, an Experian company, said: “The fall in the number of insolvencies is a good sign and shows that businesses are distinctly aware of the current environment and are taking vital steps to protect themselves from risks.
“Apart from the very largest businesses, companies of all sizes saw marked improvements in insolvency rates. However, the greatest improvement came from the medium-sized businesses, which, as we have commented in previous months, have been the hardest hit by the recession.
“However, the small deterioration in the overall financial strength score for UK businesses during May highlights the need for businesses to ensure they continue to exercise caution with regards to their risk exposure and those they choose to deal with.”
Other key highlights include:
| Region |
Insolvencies May 10 |
Insolvencies May 09 |
% of business population failing May 10 |
% of business population failing May 09 |
Financial Strength Score May 10 |
Financial Strength Score May 09 |
| Scotland |
92 |
79 |
0.08% |
0.07% |
80.63 |
80.49 |
| North East |
33 |
59 |
0.08% |
0.15% |
80.84 |
79.86 |
| North West |
206 |
253 |
0.11% |
0.13% |
79.99 |
79.43 |
| Yorkshire |
124 |
169 |
0.11% |
0.13% |
80.81 |
79.24 |
| Wales |
48 |
53 |
0.08% |
0.09% |
80.28 |
79.66 |
| West Midlands |
129 |
189 |
0.08% |
0.12% |
79.56 |
78.93 |
| East Midlands |
75 |
122 |
0.07% |
0.11% |
81.10 |
80.19 |
| Eastern |
118 |
184 |
0.07% |
0.11% |
81.69 |
81.17 |
| South West |
105 |
129 |
0.07% |
0.08% |
82.40 |
81.76 |
| Greater London |
353 |
497 |
0.07% |
0.10% |
79.53 |
78.63 |
| South East |
208 |
289 |
0.07% |
0.08% |
81.98 |
81.43 |
| Grand Total |
1,491 |
2,023 |
0.08% |
0.10% |
80.70 |
79.98 |
Source: pH, an Experian company
| Number of employees |
Insolvencies May 10 |
Insolvencies May 09 |
% of business population failing May 10 |
% of business population failing May 09 |
Financial Strength Score May 10 |
Financial Strength Score May 09 |
| 1-2 |
227 |
257 |
0.05% |
0.07% |
81.92 |
80.39 |
| 3-5 |
256 |
318 |
0.12% |
0.13% |
81.71 |
82.09 |
| 6-10 |
200 |
284 |
0.15% |
0.22% |
81.20 |
81.18 |
| 11-25 |
195 |
275 |
0.19% |
0.26% |
80.78 |
81.06 |
| 26-50 |
92 |
123 |
0.19% |
0.25% |
80.57 |
80.80 |
| 51-100 |
36 |
63 |
0.13% |
0.23% |
80.18 |
80.27 |
| 101-500 |
37 |
41 |
0.14% |
0.15% |
81.32 |
81.39 |
| 501+ |
15 |
6 |
0.16% |
0.06% |
83.94 |
84.43 |
| Unspecified |
433 |
656 |
0.05% |
0.06% |
79.84 |
78.92 |
| Grand Total |
1,491 |
2,023 |
0.08% |
0.10% |
80.70 |
79.98 |
Source: pH, an Experian company
| Sector |
Insolvencies May 10 |
Insolvencies May 09 |
% of business population failing May 10 |
% of business population failing May 09 |
Financial Strength Score May 10 |
Financial Strength Score May 09 |
| Extractive Industries |
1 |
- |
0.07% |
0.00% |
82.39 |
82.09 |
| Oil |
1 |
1 |
0.03% |
0.03% |
85.53 |
84.82 |
| Building and Construction |
230 |
281 |
0.14% |
0.17% |
77.35 |
77.29 |
| Building Materials |
7 |
7 |
0.19% |
0.19% |
79.30 |
79.96 |
| Chemicals Industry |
5 |
3 |
0.18% |
0.10% |
81.26 |
81.37 |
| Diversified Industrials |
37 |
37 |
0.17% |
0.16% |
77.61 |
78.17 |
| Electricals |
12 |
19 |
0.14% |
0.21% |
78.91 |
79.39 |
| Engineering |
49 |
80 |
0.12% |
0.21% |
79.06 |
79.61 |
| Printing, Paper and Packaging |
5 |
2 |
0.17% |
0.08% |
78.00 |
78.86 |
| Textiles and Clothing |
18 |
38 |
0.13% |
0.27% |
76.33 |
76.79 |
| Breweries |
- |
- |
0.00% |
0.00% |
79.18 |
80.34 |
| Spirits, Wine and Tobacco |
- |
1 |
0.00% |
0.20% |
81.94 |
81.37 |
| Food Manufacturing |
12 |
10 |
0.20% |
0.20% |
77.57 |
78.36 |
| Pharmaceuticals |
1 |
- |
0.08% |
0.00% |
81.36 |
82.14 |
| Wholesaling |
69 |
112 |
0.11% |
0.17% |
79.45 |
79.82 |
| Leisure and Hotels |
123 |
121 |
0.15% |
0.14% |
78.85 |
77.18 |
| Media |
49 |
61 |
0.08% |
0.09% |
80.40 |
80.02 |
| Food Retailing |
19 |
10 |
0.13% |
0.07% |
75.92 |
78.26 |
| Non-Food Retailing |
80 |
124 |
0.10% |
0.15% |
78.59 |
78.86 |
| Servicing/Repair |
7 |
17 |
0.09% |
0.19% |
81.97 |
80.81 |
| Transport |
53 |
67 |
0.10% |
0.12% |
78.13 |
76.21 |
| Utilities |
- |
1 |
0.00% |
0.05% |
79.48 |
79.98 |
| Postal and Telecommunications |
7 |
15 |
0.08% |
0.16% |
75.87 |
75.35 |
| Agriculture, Forestry and Fishing |
7 |
9 |
0.03% |
0.04% |
84.88 |
84.30 |
| Banking and Financial Services |
50 |
63 |
0.10% |
0.13% |
83.99 |
84.36 |
| Health and Household |
- |
2 |
0.00% |
0.23% |
78.91 |
79.73 |
| Business Services |
317 |
492 |
0.06% |
0.08% |
81.02 |
80.10 |
| Hiring and Leasing |
14 |
24 |
0.10% |
0.18% |
81.16 |
79.61 |
| Property |
104 |
157 |
0.07% |
0.09% |
82.46 |
84.05 |
| Other Services |
81 |
92 |
0.04% |
0.05% |
85.61 |
84.30 |
| Plastics & Rubber |
11 |
18 |
0.17% |
0.31% |
77.70 |
78.58 |
| Insurance |
14 |
9 |
0.12% |
0.08% |
83.99 |
84.88 |
| IT |
63 |
76 |
0.06% |
0.07% |
83.20 |
81.58 |
| Motor Traders |
24 |
43 |
0.07% |
0.12% |
79.71 |
79.31 |
| Unspecified |
21 |
31 |
0.02% |
0.02% |
74.19 |
69.71 |
| Grand total |
1,491 |
2,023 |
0.08% |
0.10% |
80.70 |
79.98 |
Source: pH, an Experian company
Ms Serj Heera
PR Manager
0115 992 2773/07837 652169
About 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.
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.