Insolvency specialists Begbies Traynor expect the number of companies going bust to rise over the coming months as its profits storm ahead
- Begbies Traynor saw its profit and revenue jump in its first half
- Manchester-based group expects the number of insolvencies to rise
- Many businesses are being hammered by lower footfall and spiralling costs
Begbies Traynor saw its revenue and profit jump in the six months to 31 October, new figures show.
The Manchester-based group is expecting an increase in the number of businesses entering insolvency during the second half of its financial year.
The business recovery, financial advisory and property services consultancy saw revenue increase to around £52million over the period, up from £37.5million a year ago.
Predictions: Begbies Traynor expects the number of company insolvencies to rise
Adjusted pre-tax profit grew to around £8million driven by acquisitions the group has completed since January.
Ric Traynor, executive chairman of Begbies Traynor, said: ‘I am pleased to report a strong financial performance in the first six months of our financial year, which is testament to the benefit and integration of our recent acquisitions.
‘We remain confident of delivering market expectations for the full year, which will represent a year of significant growth and ensures we are well placed to continue to invest in our successful growth strategy.’
In its update today, the group added: ‘We expect our results will have a second half weighting as we anticipate an increase in insolvency activity over the remainder of our financial year (to 30 April 2022).
‘Overall, we remain confident of delivering market expectations for the full year, which will represent a year of significant growth.
‘However, since May 2021, the Insolvency Service has reported month on month increases in insolvency appointments nationally as these support measures have been removed.
‘The increases to date have predominantly been in liquidations (which typically represent insolvencies of smaller companies), where the volume of appointments has now returned to pre-pandemic levels.
‘We have increased our share of this market segment in the year by volume.
‘Although the number of administrations (which typically involve larger and more complex instructions) has increased in recent months, they are currently significantly below pre-pandemic levels.’
The group said it had a net cash stash of £1.2million as of 31 October, up from £700,000 at the same point a year ago.
Shares in the group are currently down 0.22 per cent or 0.30p to 138.50p. A year ago the share price was 90.80p.