Business
Latest Red Flag Alert Report for Q1 2013
Latest Red Flag Alert Report for Q1 2013.
About this update from Btg Consulting Plc
[{"type":"text","content":"\n \nRNS Number : 0563D Begbies Traynor Group PLC 24 April 2013 \n \n\nBegbies Traynor Red Flag indicates UK will narrowly avoid a triple dip recession\n \n \nLatest Red Flag Alert Report for Q1 2013\nAhead of the release of the latest GDP figures this week, the most recent Begbies Traynor Red Flag Alert research for Q1 2013, which monitors the financial health of \"Corporate UK\", shows that the recovery of UK plc continues, with a 34% decline in 'Critical' financial distress among UK businesses compared to Q1 2012. \n \nAcross all sectors, UK businesses experiencing 'Critical' financial problems reduced from 5000 in Q1 2012 to 3283 in Q1 2013, indicating that the UK economy has turned a corner. However this positive picture, led predominantly by improvements in the UK's vital business services sector, masks a patchy recovery with sectors reliant on the consumer economy (general retail, leisure and media) as well as real estate, witnessing an increase in financial distress for the period.\n \nJulie Palmer, Partner at Begbies Traynor, commented: \"The year on year improvement reflects the continued forbearance and benign monetary conditions facing UK businesses today, combined with an improving credit environment, albeit primarily for larger corporates. Business confidence is slowly returning in the form of greater business spending on both services and investment1.\"\n \nWhen comparing the data on a quarterly basis, it reveals an 8% increase in 'Critical' financial distress from 3,044 in Q4 2012. This increase could largely be attributable to seasonal factors such as the propensity for creditors and directors to take action ahead of having to file accounts for the new tax year. However certain consumer-facing sectors, including leisure (up 81%), hotels (up 63%) and general retail (up 27%) have been impacted by the unseasonably cold weather experienced throughout the first quarter of 2013.\n \nLack of funding still a significant issue for UK SMEs\nMeanwhile the ongoing lack of funding to support the important SME sector is a growing concern. Begbies Traynor's analysis of new lending to business across its Red Flag database, which is predominantly SMEs, found that the number of companies that secured new funding, at 15,804 in Q1 2013, was down 14.5% from 18,943 companies in Q1 2012 and do...