A TOTAL of 238 creditors meetings were called nation-wide during quarter 3 of 2009 with 45 of those associated with the Munster region, eight of which originated in Limerick.
Recent ICC information can reveal that the construction industry accounted for 23%, followed by ‘Business Activities’ with 19.7% and Retail with 14.7%.
Dublin based Companies accounted for the majority of these with 52% followed by Cork and Galway. There were no Creditors meetings held in Monaghan, Donegal, Kilkenny, Leitrim and Mayo, but a large increase in Louth, Offaly and Cork over the previous Quarter.
According to their last filed accounts, these companies had Creditors of nearly €280 million. This was an increase of just under €80 million from Quarter 2 2009. After further analysis of these companies ICC Information found that there were several common indicators of failure that these companies shared.
“These results show that troubled times seem to be falling on many more industries and counties throughout Ireland in comparison to quarter 1 and quarter 2 this year. However, further analysis shows that there are several common indicators of failure and therefore early warning signs can be recognised” explained Michael Gannon, Head of Account and Business Development at ICC Information.
“Court Judgements continue to be a leading indicator of insolvency with 20% of those companies that held a creditors meeting in Quarter 3 having at least 1 Court Judgement against them. This compares with 14% in Quarter 2. 22% also had an audit qualification while 86% had a current ratio of below 1. Only 32% of these companies had a positive working capital whilst only 40% had a positive net worth. Typically companies with multiple indicators of insolvency are the ones at greatest risk.”
“Of those companies that held creditors meetings in Quarter 3, in 82% of cases ICC advised an abnormal risk of failure and/or advised against extension of credit. These are the early warning signs for many companies and it is essential to manage your current ledger and understand the risk associated with extending credit to certain companies” added Gannon.
ICC Information now provides credit information on 100% of all Limited and Non Limited Companies in the Irish Marketplace.
