The number of Yorkshire companies entering administration increased by more than a tenth (12 per cent) during the third quarter of the year, according to new analysis from KPMG.
The business advisory firm’s quarterly analysis of business insolvency shows that 46 Yorkshire companies went into administration between July and September, compared with 41 in the previous quarter.
In comparison with the same period last year, the number of business administrations increased by six per cent making it the busiest period of 2019 for insolvencies in the region. In the year to date, 128 Yorkshire businesses have entered administration which is an increase on 121 at the same point in 2018.
High profile cases in the third quarter included the administrations of clothing retailer Khaadi Fashion, Total Polyfilm, Late Rooms and Super Break, KPMG said.
Howard Smith, associate partner at KPMG in Yorkshire, said: “For some time now, corporate insolvencies have been ticking along at fairly steady levels, so the more marked increase in administrations seen last quarter may herald the start of a new wave of activity. This is perhaps unsurprising, given the challenges presented by fragile consumer confidence, rising overheads from fluctuations in exchange rates, increasing employment costs and political uncertainty.
“The good news is that companies across all industries are now proactively addressing long-term issues and are attempting to place themselves on a more sure financial footing, ahead of any further macro-economic challenges that are coming down the line. From CVA proposals for retailers, to refinancing in other sectors, there are options out there, and they seem to be paying off for firms taking a fiscally cautious approach.”
Nationally the number of companies entering administration jumped by more than a third (35 per cent) during Q3, totalling 417. When compared to the same period in 2018, this number represents an increase of 30 per cent from 322 businesses. Notable cases included the administrations of , Ferguson Marine Engineering and Eversmart Energy, according to KPMG.The insolvency of Thomas Cook is not included in this quarter’s figures as the group is in compulsory liquidation, rather than administration.
Despite the headline-grabbing insolvencies of high street names including Jack Wills, Karen Millen and Forever 21, the number of retailers going into administration continued to fall over the quarter, from 26 in Q2 2019 to 18 in Q3.
However, it was a less positive picture in the building and construction sector, which saw a marked increase in administrations – up from 49 in Q2 to 76 in Q3 2019; while the property sector also saw an uptick in insolvencies with numbers rising from 18 to 33 over the quarter.
Pubs, restaurants and clubs also continued to feel the effects of fragile consumer confidence, with an increase in administrations from 14 to 26.