Insolvency-related activity in Sussex increases again

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Insolvency-related activity has again increased in the South East, says R3, the UK’s insolvency and restructuring trade body.

Latest figures showed a rise in insolvency-related activities from 246 in February to 261 in March – these include administrator and liquidator appointments together with creditors’ meetings. This figure remains relatively consistent with the 12-month high of 277 in March 2023.

R3 has warned that insolvency trends are continuing to rise, following its analysis of data about insolvencies and start-ups supplied by business intelligence provider Creditsafe.

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Its findings also revealed the number of firms in liquidation which owed money to their creditors in the South East remained virtually static at 377 in March against 376 in February.

GREEN SHOOTS: Neil Stewart, chairman of R3’s Southern and Thames Valley regionGREEN SHOOTS: Neil Stewart, chairman of R3’s Southern and Thames Valley region
GREEN SHOOTS: Neil Stewart, chairman of R3’s Southern and Thames Valley region

The South East figure for insolvency-related activities is now the fourth highest for any part of the UK, behind Greater London, which has 539, the North West, 398 and East Anglia, 354. The South East has moved ahead of Yorkshire & Humberside, 242 and the West Midlands, 227, which both experienced a decrease.

Nationally, a total of 2,598 companies became insolvent in March 2024, a very slight decrease on the previous month (February 2024). The total number of insolvencies increased by 17% compared to March 2023, says Creditsafe.

Neil Stewart, chairman of R3’s Southern and Thames Valley region, said: “Although we see signs of recovery as spring kicks in, it remains tough for many businesses.

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“March’s figures reveal that economic challenges remain, with, again, an increasing number of companies being pushed into insolvency by multiple causes.

“The good news is that inflation, now at 3.4%, is expected to continue a downward trajectory, the OECD (Organisation for Economic Co-operation and Development) forecasts UK GDP to grow by 0.7% in 2024 and by 1.2% in 2025 and the Growth Guarantee Scheme was boosted with a further £200m by the Chancellor.”

R3’s Southern & Thames Valley region includes Kent, Surrey, Sussex, Buckinghamshire, Oxfordshire, Hampshire, the Isle of Wight, Dorset, Wiltshire and Berkshire.

Neil, a Regional Associate Director at insolvency litigation financing company Manolete Partners Plc, added that the reality for some businesses was that the situation remained desperate.

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He said “If at all concerned, take advice from a qualified and regulated source, before your business has passed the point of no return, and preferably while it remains solvent.

“When liabilities exceed assets it usually means that a company has become insolvent, but not necessarily beyond hope of a full recovery if swift and decisive remedial action is taken.”

The latest Creditsafe data shows a small increase for the second month running in the number of companies with invoices that had gone past their payment deadline from 57,778 in February to 58,224 in March. The 12-month high remains 60,831 in February 2023.

Meanwhile, the number of late payments made by companies owing money was slightly down from 480,368 in February to 475,431 in March.

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The number of start-ups in the South East continues to decrease this year, from February’s 7,150 to 6,311 in March.

Creditsafe is a multinational business intelligence provider with services including company credit scores and credit report information.