The latest statistics from the Insolvency Service show a massive increase in the number of retailers which went into administration in the first quarter of 2012, compared with the fourth quarter of 2011. The overall retail figures, which include automotive sales and wholesale, saw an increase of 70% (from 79 appointments in Q4 2011 to 135 in Q1 2012) but retail trade, which covers shops, saw an increase of 140% (24 appointments in Q4 2011 to 57 in Q1 2012).
Richard Fleming, UK Head of Restructuring at KPMG, commented: “Today’s figures are the culmination of a barrage of negative economic pressures thrown at the High Street in the past few years. There was a wave of high profile retail administration appointments in the first days of 2012 – not least Peacocks, La Senza and Blacks - and the latest statistics from the Insolvency Service show that the New Year pain extended beyond a small number of well known brands.
“An industry sector by sector analysis shows that administration appointment figures were either flat on the previous quarter or indeed, in the case of the transport and hotel industries, fell considerably. However, the spike in retail insolvencies drove an overall increase in administration appointments of around a fifth. Unfortunately we do not think today’s data is evidence of the traditional seasonal increase in retail failures. Our own pipeline of work suggests the High Street and the many companies which service the retail industry are running out of options, with administration – the option of last resort – now inevitable for some.”
Key findings:
- Administration appointments were up 18% from Q4 2011 (658) to Q1 2012 (779);
- The overall retail sector (including automotive and wholesale) saw an increase of 70% in administration appointments (79 in Q4 2011 to 135 in Q1 2012). Retail appointments are up around 9% compared with the same period last year (124 in Q1 2011);
- The manufacturing sector saw an increase of 34% in administration appointments (76 for Q4 2011 to 102 for Q1 2012) but appointments decreased compared with the same period last year (119 for Q1 2011);
- The hotel sector saw a decrease of nearly 50% in administration appointments (42 for Q1 2012 compared with 62 for Q4 2011). The sector saw around a 20% drop in appointments compared with the same period for last year (52 for Q1 2011);
- The transport sector saw a decrease of 24% in administration appointments (25 for Q1 2012 compared with 31 for Q4 2011). The sector saw a decrease of around 26% compared with the same period the year before (34 for Q1 2011).
-Ends-
Notes to editor
For further information, please contact:
Sorrelle Cooper, Senior PR manager, KPMG
sorrelle.cooper@kpmg.co.uk
020 7694 8527 / 07932 078218
KPMG Press Office: 020 7694 8773
About KPMG
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with over 11,000 partners and staff. The UK firm recorded a turnover of £1.7 billion in the year ended September 2011. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 152 countries and have 145,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.
