Business
Latest Red Flag Alert Report for Q3 13
Latest Red Flag Alert Report for Q3 13.
About this update from Btg Consulting Plc
[{"type":"text","content":"\n \nRNS Number : 4601R Begbies Traynor Group PLC 28 October 2013 \n \n\nUK recovery sustained by burgeoning consumer spending\n \nSMEs increasingly suffering from funding constraints\n \nLatest Red Flag Alert Report for Q3 2013\n \nAccording to the latest Begbies Traynor Red Flag Alert research for Q3 2013, which monitors the financial health of \"Corporate UK\", levels of 'Critical' financial distress among UK businesses continue to fall albeit at a slower rate, decreasing 2% on top of last quarter's 9% reduction; with improving consumer confidence making up for subdued summer trading within the UK's core services sectors.\n \nAcross all sectors, UK businesses experiencing 'Critical' financial problems reduced 2% from 3,001 in Q2 2013 to 2,951 in Q3 2013, supported by significant improvements in the UK's consumer-facing industries including Bars & Restaurants, Hotels, Food Retailing and General Retail, which all experienced marked reductions in businesses suffering 'Critical' distress, falling 30%, 21%, 16% and 8% respectively.\n \nHowever this positive trend masks a declining trend within the UK's vital service industries, with Professional Services, Financial Services and Support Services all experiencing significant increases in 'Critical' distress levels during the last three months, rising 34%, 28% and 9% respectively. These increases bring the total number of services businesses suffering 'Critical' distress up to 330, of which 83% are SMEs, suggesting that the recent improvement as reported in the latest Markit/CIPS PMI data is being fuelled by the larger companies within these services sectors. According to Begbies Traynor's analysis, declining net worth and increasing working capital deficits are driving the reported increases in distress among this group.\n \nJulie Palmer, Partner at Begbies Traynor, commented: \"Following a well documented second and third quarter surge for the UK services sector, this positive momentum masks a worrying picture among the industry's SMEs. While transactional volumes have picked up across the sectors, they have remained at historically low levels, meaning that smaller, people businesses have struggled to maintain market share during the fallow summer months in the face of competitive pressure for new business from their larger peers. Given ...