Insolvency firm Begbies Traynor hails ‘good start’ to fiscal year as business failures reach unprecedented levels
- The group is confident of achieving its full-year adjusted pre-tax profits target
- Among its recent appointments have been roofing contractor Avonside Group
- Corporate insolvency levels in England & Wales rose 81% in the second quarter
Begbies Traynor has reported a ‘good start’ to the financial year following a rise in insolvency work involving larger and mid-size companies.
Ahead of its annual general meeting today, the corporate restructuring specialist said it had traded in line with forecasts during the three months to the end of July thanks to strong activity levels across both its operating segments.
Among its recent appointments have been Avonside Group, Britain’s largest roofing contractor, whose collapse followed a spell of heavy expansion, accounting issues and disruption resulting from the pandemic.
Strong Performance: Corporate restructuring specialist Begbies Traynor said it had traded in line with forecasts during the three months to the end of July
Begbies Traynor successfully managed to save 79 jobs from selling off nine roofing divisions of the business but had to close the remaining roofing branches and its plumbing arm.
Other appointments have included Silverbond Enterprises, the one-time operator of Park Lane Casino in London’s Mayfair district, and short-term holiday lettings operator Houst.
Begbies Traynor previously predicted that it would benefit from a surge in firms falling into administration as Covid-related public assistance programmes were wound down and limits on creditor action were lifted.
Voluntary liquidations by businesses in England and Wales from April to June reached their highest quarterly level in more than six decades, according to figures from the Insolvency Service.
This caused the overall number of corporate insolvencies to skyrocket by 81 per cent year-on-year from 3,105 to 5,629 during the period.
There is a strong likelihood that bankruptcies could remain elevated in the coming year due to surging energy prices, interest rate hikes, and weaker economic growth.
Two months ago, Begbies Traynor’s executive chairman Ric Traynor said he would be hiring up to 100 extra staff by the end of April in anticipation of the rise in business failures.
Reflecting this outlook, the Manchester-based company said today that it was confident of achieving full-year adjusted pre-tax profits of £19.7million to £20.6million.
‘Overall, the group remains in a strong position,’ the firm added.
‘Our scale, capabilities and breadth of expertise provide us with the ability to continue to assist our clients as they face the challenges of the forthcoming year.’
Over the past four years, Begbies Traynor has seen annual revenues more than double from £52million to £110million and adjusted earnings before tax increase from £5.6million to £17.8million.
Begbies Traynor shares were up 2.3 per cent at 144.2p during the late afternoon on Thursday, meaning their value has grown by over 23 per cent in the past six months.