Figures released by kavanaghfennell and published by InsolvencyJournal.ie, show a decline of 13% year-on-year for the first quarter of 2014 in the number of corporate insolvencies recorded in Ireland.
While the figures paint a positive picture, kavanaghfennell still expects to see a significant number of insolvency actions occurring in 2014, particularly across the property area and in examinership applications.
Declines recorded across most industry sectors bar the motor trade.
- Corporate insolvencies at 303, a decline of 13% (Q1 2013: 347)
- Insolvencies in construction sector at 64, a decline of 29% (Q1 2013: 90)
- Insolvencies in retail sector at 50, a decline of 11% (Q1 2013: 56)
- Insolvencies in hospitality sector at 35, a decline of 20% (Q1 2013: 44)
- Insolvencies in motor industry at 12, an increase of 33% (Q1 2013: 9)
With regard to corporate insolvency types, liquidations, including both court and creditors voluntary liquidations (CVL), continued to dominate, accounting for 69% of total insolvencies in Q1 2014. Receiverships accounted for 29%, while examinerships accounted for 2%.
- CVLs at 185, a drop of 28% (Q1 2013: 256)
- Court liquidations at 24, an increase of 100% (Q1 2013: 12)
- Receiverships at 89, an increase of 23% (Q1 2013: 72)
- Examinerships at 5, a decline of 29% (Q1 2013: 7)
Commenting on the data, David Van Dessell, partner with kavanaghfennell said: “Although the incidence of corporate insolvencies could fall further during 2014, we do not anticipate the drop will be significant, as we expect an increase in examinership applications, particularly under the new legislation where SME directors can utilise the process to restructure SME corporate debt, while continuing to trade under the protection of the court. We also anticipate sustained activity in the property receivership arena as the property market strengthens in urban areas, leading to better returns for secured creditors. We also envisage increased personal insolvency activity that should be borne out by the second quarter figures to be issued by the Insolvency Service of Ireland (ISI).”