Thomson Reuters – Practical Law has recently published their Company Administration Trends Report for 2018 and Q1 of 2019. We have set out some notable information and statistics included in the Report below.
Overall Appointment Numbers
- The number of administration appointments increased in 2018 after a steady decline between 2014 and 2017. 2018 represented an 18% increase in appointments from 2017. Despite this latest increase, the 1449 appointments in 2018 is still 6% below the amount of appointments in 2014.
- The top ten industry sectors in 2018 with the largest number of appointments represent 75% of the year’s total appointments. These top ten sectors appear to have suffered most in the first and last quarter of 2018, with the majority of appointments being made in these quarters.
- As with previous years, the construction and industrial sector saw the most appointments in 2018.
- The other industry sectors in 2018 in the top ten for number of appointments include travel and leisure, retailers, automobiles and transportation, real estate, food and beverage, media, pharmaceuticals, biotechnology and healthcare, computer and electronic equipment and mining, metals and engineering.
- The most significant change in terms of representation of appointments was the travel and leisure sector. In 2017, it was the third ranking industry sector in terms of appointments, representing 91 appointments. This sector became the second ranking in 2018, with a 43% increase in appointments.
- In the first quarters of 2017 to 2019, the automobile and transportation and financial sectors have shown a constant decline of appointments, whereas construction and industrials and the real estate sectors experienced a constant increase.
- Insolvency practitioners in London took the highest number of appointments in 2018, with 33% of all appointments.
- Every region other than Northern Ireland and the North East displayed an increase in appointments in 2018, compared to 2017.
- The East Midlands took 68 appointments in 2018, compared to 54 in 2017.
Distribution of Work
- Similarly to previous years, work was distributed so that a large number of firms took very few appointments. In 2018, 75% of the 189 firms that took administration appointments only took five or fewer appointments.
- The number of appointments with at least one female insolvency practitioner involved continues to increase. In 2018, 21% of all appointments were appointments with a female insolvency practitioners on the ticket.
The Outcome of Administrations
- The Report also looks at companies that went into administration in Q1 of 2014, being Thomson Reuters’ first quarter of statistics, in order to ascertain whether the process of administration was achieving rescue rather than liquidation.
- In May 2017, Thomson Reuters’ analysed the outcome of the companies placed into administration in Q1 of 2014. The position was that of 487 appointments, 450 were in creditors’ voluntary liquidation or dissolved. Of the 37 remaining, 22 were still in administration, 8 were in another form of insolvency proceedings and 7 were shown as active (i.e. no longer in administration or any other insolvency proceedings, according to Companies House).
- As at May 2019, of the 37 companies mentioned above, five are shown as active, 21 have been dissolved, five are in insolvency proceedings other than administration and six remain in administration.
Posted on August 19, 2019