The Insolvency Service has released the latest figures for UK company insolvencies for August 2024.
The number of registered company insolvencies in England and Wales was 1,953 in August 2024, 9% lower than in July 2024 (2,144) and 15% lower than the same month in the previous year (2,286 in August 2023). It's important to note that the number of company insolvencies remained significantly higher than those seen between 2014 and 2019, a period of relative stability in the business landscape.
Of the 1,953 registered company insolvencies in August 2024, there were:
Figure 1: Company insolvencies in August 2024 were lower than in July 2024 and August 2023.
Sources: Insolvency Service (compulsory liquidations only); Companies House (all other insolvency procedures)
In August 2024, Company Voluntary Liquidations (CVLs) comprised 79% of all company insolvencies. The number of CVLs decreased by 7% from July 2024 and was 15% lower compared to the same month last year (August 2023) after seasonal adjustment.
In 2023, the number of CVLs (Company Voluntary Liquidations) reached the highest annual level since records began in 1960. This continues the trend of year-on-year increases that started in 2021. Between 2017 and 2019, CVLs were increasing at approximately 10% per year, but during the COVID-19 pandemic, they dropped to the lowest levels seen since 2007.
The number of seasonally adjusted compulsory liquidations in August 2024 decreased by 12% compared to July 2024 but increased by 6% compared to August 2023.
The rise in compulsory liquidations follows record low levels in 2020 and 2021, influenced by restrictions on statutory demands and certain winding-up petitions. In 2023, compulsory liquidations surged by 44% from 2022 yet remained 4% lower than 2019. As of 2024, monthly compulsory liquidation figures have surpassed those of 2019.
After seasonal adjustment, the number of administrations in August 2024 decreased by 25% compared to July 2024 and by 40% compared to August 2023.
It's worth noting that the number of administrations markedly increased in 2022 and 2023, rebounding from an 18-year annual low during the COVID-19 pandemic in 2021. The current levels are comparable to those seen between 2015 and 2019.
The number of CVAs surged by a significant 82% in August 2024 compared to the same period in 2023, marking a notable shift in the trend. However, it's important to note that this figure was 20% lower than in July 2024, and the overall numbers remain low compared to historical levels.
In 2023, the number of CVAs increased substantially by 68% compared to 2022, which had the lowest annual total in the time series dating back to 1993. However, it's crucial to understand that 2023 remained at approximately half of the levels seen during the 2015 to 2019 period.
The five industries (in accordance with SIC 2007) that experienced the highest number of insolvencies in the 12 months to July 2024 were:
Company insolvency by industry, England and Wales, August 2023 to July 2024 compared with August 2022 to July 2023:
CoCredo has been one of the UK's best credit check companies for over twenty years, providing online Company Credit checks and financial data in the UK, Ireland, and internationally.
CoCredo MD Dan Hancocks says, "I understand the decrease in corporate insolvency figures for this month. However, it's essential to acknowledge that businesses are still struggling. Many are grappling with high levels of debt during challenging trading conditions.
“While there have been improvements in the overall economic landscape, the market continues to present challenges, and the prudent management of costs remains a significant concern for many SMEs."
Retail sales showed a promising increase during the summer, with a notable rise in construction output in July. However, whether these improvements will adequately offset the challenges faced during the previous months remains to be seen. The upcoming pre-Christmas trading period will be crucial in determining whether it can support companies across the economy."
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