Insolvency group Begbies Traynor boosted by rise in business failures
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Insolvency firm Begbies Traynor applauds ‘good start’ to fiscal year as bankruptcies reach unprecedented levels
- The group is confident that it will meet its full year adjusted profit before tax target
- Recent appointments have included roofer Avonside Group
- Business insolvencies in England and Wales increased by 81% in the second quarter
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Begbies Traynor reports a ‘good start’ to the fiscal year after an increase in bankruptcies involving larger and medium-sized companies.
Ahead of today’s annual general meeting, the corporate restructuring specialist said he had acted in line with forecasts in the three months to the end of July, thanks to strong activity levels in both business segments.
Among his recent appointments was Avonside Group, Britain’s largest roofer, whose collapse followed a period of heavy expansion, accounting problems and disruption caused by the pandemic.
Strong performance: business restructuring specialist Begbies Traynor said it had traded in line with forecasts in the three months to the end of July
Begbies Traynor managed to save 79 jobs by selling nine of the company’s roofing divisions, but had to close the remaining roofing divisions and the plumbing business.
Other appointments have included Silverbond Enterprises, the one-time operator of Park Lane Casino in London’s Mayfair, and short-term holiday operator Houst.
Begbies Traynor previously predicted it would benefit from a wave of businesses under administration as Covid-related public aid programs were phased out and limits on creditor action were lifted.
Voluntary liquidations by companies in England and Wales from April to June reached the highest quarterly level in more than six decades, according to figures from the Insolvency Service.
This caused the total number of corporate insolvencies to rise 81 percent year-over-year from 3,105 to 5,629 during the period.
There is a good chance that the number of bankruptcies will remain high in the coming year as a result of rising energy prices, interest rate hikes and weaker economic growth.
Two months ago, Ric Traynor, executive chairman of Begbies Traynor, said he would hire up to 100 additional employees by the end of April, ahead of the increase in bankruptcies.
As a result of this outlook, the Manchester-based company said today it is confident it will achieve full-year adjusted profit before tax of £19.7 million to £20.6 million.
“Overall, the group remains in a strong position,” the company added.
“Our scale, capabilities and broad expertise give us the opportunity to continue to help our customers meet the challenges of the coming year.”
Over the past four years, Begbies Traynor has more than doubled annual revenues from £52million to £110million and increased adjusted pre-tax profits from £5.6million to £17.8million.
Begbies Traynor shares rose 2.3 percent at 144.2 pence late Thursday afternoon, meaning their value is up more than 23 percent in the past six months.