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Mid-sized UK businesses see insolvency rate drop in June

Mid-sized UK businesses see insolvency rate drop in June

*         East Midlands the most improved region

*         101-500 employee companies see insolvency rate fall the most

The latest Insolvency Index from ExperianAE, the global information services company, has revealed that mid-sized and large businesses performed better in June this year.

Businesses employing 51-100 employees saw failure rates drop from 0.23 per cent in June 10 to 0.19 per cent last month. The rate of failure amongst firms with 101-500 employees more than halved year-on-year, falling from 0.17 per cent to 0.08 per cent of the population this June.

The East Midlands was the most improved region in June 11, with the rate dropping from 0.11 per cent in June 10 to 0.09 per cent.  The South West had the lowest rate of failures, with just 0.07 per cent of the business population becoming insolvent last month.  In contrast, businesses in the North West and Scotland both experienced an increase against last year.

As a whole, the failure rate for all UK businesses remained stabled at 0.09 per cent, although the financial strength score of UK businesses as a whole fell from 80.83 to 80.06 in June this year.

The Building materials industry had the highest rate of failure, 0.27 per cent, followed by Building and Construction, with a rate of 0.18 per cent.

Max Firth, Managing Director for Business Information Services at Experian, said: "June's data indicates that the UK's business community as a whole is generally stable, however it also points to a change in circumstances for different sized businesses. The largest companies have experienced a turnaround in fortunes and now the larger mid-sized businesses are following suit with a significant improvement since last year. Our analysis also shows that businesses in the north seem to be faring slightly worse than their southern counterparts."

"Although the data shows improvements in some regions and sectors, individual organisations are impacted in different ways. It is vital for businesses to understand and monitor the circumstances of those they are doing business with and the risks they could expose them to."

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