THERE were 32 company insolvencies recorded in Northern Ireland in the last three months of last year - up 33 per cent on the same quarter of 2020.
The Insolvency Service confirmed that there were 18 Creditors’ Voluntary Liquidations (CVLs) as well as three administrations, 10 compulsory liquidations and one company voluntary arrangement (CVA).
The increase in the year relates predominantly to an increase in CVLs, which stand at 12,661 for the period – the highest annual number since 2009.
The overall numbers still remain low when compared with pre-pandemic levels, driven in part by a range of government support put in place to financially support individuals during this time over the last two years.
But David Warnock from Grant Thornton in Belfast warned: “With the majority of support measures coming to an end last year, including the furlough scheme, there continues to be a challenging environment for businesses that have been impacted by the pandemic.
“So if company directors are concerned about their cash flow levels and overall financial health, they should seek support as early as possible to allow for the assessment of a greater suite of options.”
Indeed it appears businesses are bracing for the full force of debts accumulated during the pandemic to hit as Covid reliefs unwind, a new report has claimed.
Corporate restructuring specialist Begbies Traynor said there have been significant spikes in key indicators that companies are under pressure.
The number of Northern Ireland businesses that reported "significant financial distress" rose in the three months to the end of December to 8,680, which is up 7 per cent on the previous quarter.
Lawrence O’Hara, who leads Begbies Traynor in the north, said: “Over the pandemic, businesses have had to cope with a challenging and quick-changing environment from the disruptive stop-start of lockdowns, to a host of restrictions as well as staff and huge global supply chain problems.
“All of these challenges have increased uncertainty and made planning and forecasting extremely difficult.
“So it is hardly surprising that early-stage financial distress saw a sharp uplift in the final quarter of 2021 as many businesses reeled from the impact of the fast-spreading Omicron variant.”
Almost all sectors saw a rise in ‘significant’ distress in Northern Ireland since the previous quarter with hotels (28 per cent increase), printing (up 25 per cent), professional services (14 per cent rise), and construction and telecoms (both up by 11 per cent) among those most badly affected.