LAURA SLATTERY

FOUR COMPANIES a day went out of business in 2009, with a similar rate of insolvency expected for most of 2010, according to new data compiled by InsolvencyJournal.ie.

The figures show that 1,406 Irish businesses were declared insolvent last year, as hundreds of construction companies were joined by household names such as O’Brien’s Sandwich Bars and Budget Travel on the list of liquidations.

The year ended badly for businesses, with 156 companies going bust in December – the highest total of any month last year – and an indication that dole queues are likely to remain long in 2010.

The construction industry was by far the worst-affected sector, with 453 construction companies declared insolvent as developers’ debts spiralled out of control.

The monthly number of construction firms going bust also peaked in December, with 49 construction insolvencies, InsolvencyJournal.ie said.

Corporate recovery specialist Ken Fennell, from Kavanagh Fennell, the accountancy firm behind the website, said that he expected the number of insolvencies among retailers, hotels and restaurants would continue to climb next year, while the rate at which businesses across all sectors are failing will stay high as business conditions remain severe.

“For the coming year, the outlook remains pessimistic as the rate of insolvency will be similar to 2009, with a peak mid-year followed by a gradual reduction in the last quarter of 2010,” Mr Fennell said.

But with so many construction companies having already gone out of business, the number of insolvencies in this sector is expected to level off in 2010.

“Most of the big guys have gone now,” Mr Fennell said.

Four firms a day go out of business and trend is set to continue - The Irish Times - Mon, Jan 04, 2010