The construction and property sector is “holding fast”, according to Deloitte, as administrations were down 14 per cent in the third quarter of 2009 compared with the same period in 2008
While the total number of administrations for Q3 is down on the same quarter for last year - a marginal drop of 6 per cent - recovery is still not being felt across the board.
Deloitte reported that the total number of companies falling into administration increased by 10 per cent during the first nine months of 2009 compared to the same period in 2008.
Meanwhile the construction and property sector saw a seven per cent increase in administrations in the first nine months of 2009.
Deloitte’s reorganisation services partner Lee Manning said: “In spite of talk of economic recovery, it is evident that the situation is far from rosy.
“The number of companies falling into administration is still rising: although, if we are to look at our analysis of the first half of the year, which saw administrations increase by 18 percent, the pace appears to be decelerating as we move further into 2009.
“The property and construction sector is holding fast. Administrations in the sector have risen just 7 per cent in the first three quarters of the year compared with the same period in 2008, and are down 14 per cent in Q3 2009 compared with Q3 2008.
“We have since seen a weeding out process with the stronger and better managed businesses coming through. These businesses have restructured and refinanced through various measures including debt for equity swaps and rights issues, thereby buying themselves a life line. It is not surprising then that these figures are slowing down, and even dropping.”
The analyst noted that the first nine months of 2009 saw 2320 companies fall into administration, compared with 2109 companies in 2008.