More than 1,500 companies were declared insolvent during 2010, according to statistics complied by insolvencyjournal.ie; however, representative Ken Fennell believes that while 2011 will again be a very difficult year for Irish businesses, the overall number of insolvencies probably peaked last year.
Not surprisingly construction was the hardest hit sector with 472 companies or 30 per cent of the total going bust during 2010. Some high profile construction failures during the year included the Fleming Group, Pierse Contracting, and McInerney Group.
The services sector was the next hardest hit with a total of 279 insolvencies accounting for over 18 per cent of the total, the majority of these companies would be connected to or auxiliary to the construction industry such as architects, quantity surveyors, and other construction related service providers.
The hospitality sector also suffered badly during 2010 with 194 companies going bust during the year. Some of the notable collapses in the hospitality sector included The Residence Club, Tweedy Group, City West Hotel, Johnstown House Hotel, and Killeshin Hotel. Mr Fennell believes this sector will continue to experience difficult trading conditions during 2011 and expects more casualties throughout the year.
Retail insolvencies account for 177 of the total, however these figures only include corporate insolvencies and do not take account of sole traders or partnership failures, of which there are no official statistics available. Mr Fennell believes the number of retail failures are considerably higher than the 177 reported cases. Some high street names that collapsed during 2010 include Hughes & Hughes, Pulse Accessories, Vera Moda, and Four Star Pizza. Mr Fennell is also of the view that 2011 will be a very challenging year with many more retailers going out of business.
Geographically Leinster accounted for more than 65 per cent of all insolvencies, with Munster accounting for 21 per cent, Connacht nine per cent, and Ulster just five per cent.
The figures show a massive increase in the number of receivers being appointed with the banks appointing 225 receivers during 2010 in comparison to 124 in 2009 and just 57 in 2008.
The most dramatic decrease in 2010 was the number of companies seeking protection from creditors by placing the company in examination. A total of 16 companies went into examination compared to 37 in 2009, a decrease of 57 per cent. The low number of companies entering examinership is a reflection of the difficulty in negotiating a successful path through the process. However, there have been some notable successes including Aer Arann, Best Seller, and Jackie Skelly.
