Begbies Traynor sees insolvency demand subdued

BEGBIES Traynor, the national business recovery practice, said that the first four months of its new financial year have seen no uptick in “subdued” market conditions.

In a statement ahead of the group’s annual meeting in Manchester, founder and executive chairman Ric Traynor said slowness in the corporate insolvency market over the summer – which is historically the quietest time of the year – was evidenced by the Government insolvency statistics showing a 13% fall in corporate insolvency appointments in the six months to June 30.

He said: “In addition there remains pressure on fee rates and the value of cases, overall leading to a reduction in year on year revenue to date.”
 
He said cost reductions worth £2m had been implemented, which have “partially mitigated” the reduction in revenue.

While the group’s outlook for the year is unchanged, it is not expecting  the insolvency market to pick up.

Mr Traynor concluded: “Whilst the group retains the resources to handle an increase in activity levels should it arise, and the financial capacity to make organic investments and selective acquisitions, the board continues to plan for the persistence of current suppressed market conditions.”