Begbies Traynor forecasts further growth from rising insolvencies

Begbies Traynor has said it expects to continue to benefit from rising insolvencies over the coming year as pandemic support measures are wound down.

The corporate restructuring specialist believes its full-year results will show it is hitting current market expectations following a strong performance in the six months to the end of October.

It reported revenues surging 39 per cent to £52.3million and pre-tax profits jumping by 60 per cent for the half-year period, following a significant rise in small business liquidations and a good recovery in administrations. 

Optimistic: Company founder and executive chairman Ric Traynor said: ‘We have a strong platform for growth, and we continue to progress a pipeline of acquisition opportunities’

Recent government figures showed the volume of insolvencies returned to pre-pandemic levels in October after lockdowns, legislative changes and public financial aid depressed their numbers last year. 

But the firm also attributed its results to the integration of numerous companies it has recently acquired, including finance brokerage MAF Finance Group, CVR Global and its largest-ever acquisition, David Rubin & Partners.  

Begbies Traynor expects to further benefit in the second half of the fiscal year from a large pipeline of deals in its corporate finance arm and the continued effects of government pandemic assistance schemes ending. 

Company founder and executive chairman Ric Traynor said the results were ‘testament to the benefit and integration of our recent acquisitions and maintains our track record of growth in revenue and adjusted earnings’.

He added: ‘This strong performance, and an anticipated increase in national insolvency numbers following the removal of the Government’s pandemic support measures, leaves us confident of delivering market expectations for the full year.

‘We have a strong platform for growth, and we continue to progress a pipeline of acquisition opportunities, which together with organic growth initiatives across the group, will enable us to build upon our track record, and we remain confident in our outlook for the current year and beyond.’

From the start of October, the UK Government began phasing out programmes that have helped financially prop up businesses during the pandemic, including the coronavirus job retention scheme and limits on creditor action.

However, it did introduce new rules to help cushion these changes, such as increasing the current debt threshold for a winding-up petition to at least £10,000 and certain conditions on creditors.

These new rules will be in force until the end of March next year. That date will also see the end of restrictions on commercial tenants being evicted by landlords.

This post first appeared on Dailymail.co.uk