Insolvencies still on the rise

More than 1,000 companies were declared insolvent during the first six months of 2011, compared to 907 for the same period a year earlier, according to new figures.

The Vision-net.ie data also shows a 31 per cent rise in company dissolutions, with 7,501 firms folding so far this year.

The number of receivers appointed to companies rose by 39 per cent during the first half of 2011, indicating that many companies are failing to service their debts.

The statistics also show 12 court applications were made to have an examiner appointed - a fall of 43 per cent compared with the first six-months of 2010.

There were 12,032 first-time director appointments made during the first half, down 15 per cent compared with the same period last year.

The scale of the decline has worsened month-by-month this year, with early indicators showing 48 per cent less first-time directors in June compared with January. Meanwhile, the number of new business name registrations has fallen by 9 per cent to 13,902.

Company incorporations totalled 7,310, up 4 per cent on the first six months of last year.

Vision-net also carried out credit rating stress tests on a wide sample of 66,701 private limited companies which have filed accounts since the start of the year.

The results of these stress tests reveal that 32,000 companies, or almost half of the sample surveyed, are struggling with debt and at risk of failure.

Companies in the business and professional services sectors followed by the construction and real estate sectors have the largest number of companies classified as high risk, with a combined total of 25,405 companies affected.

Vision-net.ie managing director Christine Cullen said the new figures highlighted the extent of the "two-speed" economy which has emerged in Ireland recently.

"While current data suggests strong export and growth figures for Irish-based multinational corporations, thousands of Irish companies are struggling with the continuing weakening of the domestic market.

"More than one in every two companies is now showing signs consistent with business failure. Eight per day on average are ceasing trading. Most compelling of all perhaps is the drop off in first time directors. The trend is now showing consistently that the entrepreneurs the country needs to recover are opting out," she added.