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Business failures fell 19pc in 2013

Thursday, January 02 11:05:21

The latest insolvency statistics published by www.insolvencyjournal.ie, show business failures for 2013 have totaled 1,365 - a 19pc reduction on totals of 1,684 for 2012 and a 17pc decrease on the 1,638 total for 2011.

Geographically Leinster accounted for 64pc of all insolvencies, with Munster accounting for 23pc, Connaught 9pc and Ulster just 4pc.

Looking at the industry breakdown, construction was yet again the hardest hit sector, accounting for 25pc of total insolvencies. There was, however, a year on year decrease of 16pc with 347 construction insolvencies in 2013 compared to 415 for 2012. Some high profile cases during the year included, Belmayne, the large housing development in north county Dublin which entered receivership with debts of E150m along with the examinership of the 100 year old business SIAC Construction.

The retail sector accounted for 14pc of all insolvencies for 2013 totalling 190, showing a decrease of 14pc compared to 2012. Online shopping has become a major issue for retailers and a significant amount continue to struggle. However as the winter sale season got underway on St. Stephens Day Retail Excellence Ireland have confirmed its biggest sales success since Christmas 2008 with retailers reporting an overall increase of 20pc in sales this year so far. According to David Fitzsimons of Retail Excellence Ireland "The sales period after Christmas each year is worth approximately E900m to Irish retailers, but we could easily top the E1bn mark this year, given the start we've seen".

2013 saw many high street retailers entering an insolvency process such as the examinership of Pamela Scott and Homebase, both exiting the process successfully. There was a receiver appointed to HMV in early 2013 and the business was later bought by Hilco who reopened four of the stores in Ireland. Fashion retailer A-Wear entered examinership in October but a receiver was appointed in November and some of the stores have reopened while a buyer is being sought.

Insolvencies in the hospitality industry also decreased from 171 in 2012 to 163 in 2013, a 5pc drop. Some high profile hospitality cases during the year were the Ritz-Carlton Powerscourt Hotel in Enniskerry which failed examinership and was put into liquidation, Muckross Park Hotel, Killarney which entered receivership and the well known family-run Foley's bar and restaurant business on Dublin's Merrion Row.

The recent Irish Hotel Federation's (IFI) quarterly barometer picks up a notable improvement in sentiment among its members with 84pc saying they have a positive outlook for the coming 12 months with just 46pc of respondents having the same confidence a year ago. According to the IHF, "almost three quarters of Irish hotels and guesthouses are reporting increased business for 2013". IHF chief executive Tim Fenn said, "The Gathering had proved an enormous success in attracting additional overseas visitors, particularly from North America".

There has been a decrease in insolvencies across all industries during 2013 apart from the motor sector who have recorded a 43pc increase from 30 in 2012 to 43 in 2013. The latest new car stats from The Society of the Irish Motor Industry (SIMI) show that the sale of new cars was down 6.5pc so far for the year at the end of November compared to last year. Alan Nolan, SIMI's Director General commented "As we look forward to the New Year and the 141 registration period in new car sales, there are strong indications of improved levels of activity. Dealers across the country are reporting an increase in showroom traffic compared to this time last year with orders for 141 registrations up on last year, so many in the Industry are more positive about the outlook for the first quarter of 2014".

Receivership totals for 2013 reached 363 a 9pc drop on totals for 2012 (399). These receivership totals do not include personal asset receiverships. It was recently reported that Irish banks have appointed rent receivers to close to 2,000 properties, the information emerged in a Dail reply by Minister for Finance Michael Noonan. Rent receivers are appointed where landlords are collecting rent but not passing it on to the financial institute to pay the mortgage arrears. The article on www.rte.ie stated Bank of Ireland had appointed rent receivers to over 1,235 properties by the end of June with AIB appointing rent receivers to over 540 properties.

Examinerships for 2013 are at 21, which is a 22pc drop on totals for 2012 (27). Liquidations, including both Court Liquidations and Creditor Voluntary Liquidations totalled 981 for 2013, a 22pc decline on 2012 totals of 1,258.