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SURVEY: New Business Trends 27 February 2013

Joe McGrath reveals the trends resulting from administration work in 2012 researched from Insolvency Today’s BlackBook.

The research below is a small sample of data from the forthcoming Insolvency BlackBook. To order a copy click here or call 020 7940 4832 for more information.

Competition for insolvency and turnaround work was fierce in 2012, with even the very largest firms struggling to maintain the volumes of business witnessed in previous years.

The research team at Insolvency Today spent six months crunching the case numbers of every administration appointment between 1 January 2012 and 31 October 2012 and results are startling.

Within TheBlackBook2013, you will see a breakdown of the busiest firms, according to official records that were filed with the London Gazette during the aforementioned period. We have also analysed each sector to identify which firms landed the most cases in each industry group.

Additionally, we have broken down each firm’s regional focus to highlight those companies which land more work in particular geographical areas and plotted the most common creditors in the administrations handled by each firm.

This research has been taken from the forthcoming Insolvency Black Book which breaks down this data still further by individual practitioner also including data on monthly workload, industry memberships, creditor relationships and notable cases.

The data for this report was gathered from reports published on the London Gazette, so only contains details of administrations in England and Wales.

The data was taken only from the official notices marked ‘appointment of administrators’, stripping out administrative receiverships, liquidations and winding up orders. This form also provided us with the information necessary to classify by sector.

The collected data from the Gazette was then cross-matched with Companies House, checking the last registered charge / debenture for each of the companies at the time that they entered administration.

This information was then grouped into sets based on the insolvency firm and the individual practitioners themselves.

REGIONS
All companies entering administration were grouped into five different regions:

1. South West
The South West region includes: Cornwall, Devon, Dorset, Somerset, Wiltshire and the Bristol commuting area (or former county of Avon).

2. South East
The South East region encompasses London and the counties surrounding the M25 (Essex, Hertfordshire, Buckinghamshire, Berkshire, Surrey and Kent). It also includes East Sussex, West Sussex, Hampshire, Oxfordshire and Bedfordshire.

3. Wales
Every county in the country of Wales is classified here.

4. Midlands & East Anglia
This region begins at the Welsh border and includes Shropshire, Hereford & Worcestershire, Gloucestershire (but not South Gloucestershire unitary authority). It also includes everything north of Warwickshire, Northants, Cambridgeshire and Suffolk. The top border of this region is Staffordshire, Derbyshire, Nottinghamshire, Leicestershire and Norfolk.

5. North
Lincolnshire, South Yorkshire and Cheshire mark the southern-most border of this region, which stretches up to Cumbria and Northumberland.

Table 1 (below) shows a breakdown of the busiest practitioners for the South West of England. While the South West was one of the lowest regions in terms of administration case numbers, there were clearly some firms that did better here than they did in the national picture.

Table 1

In joint third place, Bristol-based Houghton Stone showed it was more than capable of competing with the larger firms who arguably enjoy mightier staffing and resources. Houghton Stone picked up over 6% of the administration cases in the West Country – the same as Moore Stephens and BDO.

Notable cases landed by Houghton Stone included Reactive Property Services, A1 Tyres (Bath) Limited, RMB Craftscapes Limited, Bubo restaurant Company Limited and HQB Partners Limited.

Also worthy of note is West Country-based chartered accountancy firm Bishop Fleming. The firm handled more administration cases in the South West than the majority of UK practitioner firms. While it fails to make the top 25 firms nationally, the organisation clearly doesn’t struggle for cases on its home turf.

Bishop Fleming’s cases included work in the financial, construction, manufacturing, retail and services industries. These cases included Arcadia Developments Limited, Hart Inns Limited, Provincial Catering Construction Limited, Paul Evans Partners Ltd and Shipmates Chandlers Ltd.

Table 2 (below) shows the top 20 firms for administration work in the South East of England. 20 firms are listed here due to the large volume of work in the region which includes the English capital.

Table 2

Despite ranking only sixth in the national picture, FRP Advisory is the top performing firm in terms of administration case numbers between the assessed period of 1 January – 31 October 2012. In total, FRP picked up 7.2% of all cases in the region and this also contributed significantly to its national ranking.

Second place in the region went to RSM Tenon which also collected work in a very wide range of sectors including retail, media, travel, technology and tourism.

The administration of Log Book Loans Ltd was one of the better known financial cases handled along with Bond Partners LLP. Restaurant business St John Chinatown Limited also proved to be a popular case for media attention.

In third spot, Duff & Phelps did particularly well in the London region, collecting cases such as Allders (Croydon), Power Plate International Limited and bridging loans business Tiuta International Ltd.

Elsewhere in the region, things were slightly more quiet, although the firm did collect a handful of cases outside of London such as that of Burridge Holdings Limited (East Sussex), Happee Care Limited (Kent) and Arinza Star Hotels Limited (Essex).

Table 3 documents the busiest firms by case numbers in Wales. KPMG was the clear winner here, well ahead of Begbies Traynor, Grant Thornton and Leonard Curtis.

Table 3

Inevitably, the administration of nationwide retailer Peacocks ensured that KPMG leapt to the top of the table thanks to over half a dozen cases from the group including Peacock’s Stores Limited, Hilton Fashions Limited, Henson No.4 Limited and Bon Marche Limited.

Away from the work of Chris Laverty and Richard Fleming, Paul Dumbell and Paul Flint collected the case of Benders UK Holdings Limited while Jon Pope and Colin Haig led on Grayston Investments Limited.

Begbies Traynor climbed the table thanks to Plastics Sorting Limited, McBurney Retail Limited, Myddelton Leisure Ltd and Andrew Markham and Co – a case it shared with practitioners at Stones & Co.

Grant Thonton’s cases included Barnhill Construction, CDM Shopfitting and All Mass Cladding Systems Ltd while Leonard Curtis picked up the Labelsprint group among some other regional cases.

Table 4 (below) shows Begbies Traynor was the practitioner firm gaining the most administration work in the North of England during the assessed period. IPs from Begbies handled cases in the construction, technology, catering, healthcare, manufacturing, services and tourism industries.

Table 4

Begbies’ 11% of all cases was even more impressive given that second-placed Leonard Curtis only accounted for 8.8% in a region which includes the largest number of ceremonial counties and unitary authorities.

However, it should be noted that Leonard Curtis is a particular force to be reckoned with in the areas in and around Greater Manchester, Lancashire and Cheshire. The majority of the firm’s work in the region came from these three areas and they were across an exceptionally broad range of sectors. These included sports and leisure, automotive, catering, manufacturing, retail, media, technology, construction, property and support services.

The final table – Table 5 (below) – shows where Zolfo Cooper has its power base. With 7.3% of the cases in the Midlands and East Anglia region, it is easy to see that this region is a lot more competitive that some of the others. Only the South East region is more fiercely contested.

Table 5

The administration of Nottinghamshire-based Bournston Estates group of companies certainly boosted Zolfo Cooper’s activity in this region. These cases, handled by Ryan Grant and Simon Wilson went some way to boosting Zolfo’s overall total. Other cases of note included Churchill Inns LLP, Riley (Holdings) Limited, Tobar Ltd and Greyflex Ltd.

NATIONAL RANKINGS: ADMINISTRATIONS
Table 6 - National Rankings

What the Table shows: Administrations across England & Wales between 1 January 2012 and 31 October 2013.
Source: London Gazette / Insolvency Today MI Database

SOUTH WEST SNAPSHOT:
HOUGHTON STONE

Houghton Stone was established in 1989 by Richard Houghton, who founded the company on the belief that entrepreneurial organisations needed a business advisory service with an entrepreneurial flair.

Since then the company has become one of the largest independent business advisors in the South West. Over the assessed period (1 January – 31 October 2012), Houghton Stone has shown it is able to handle cases in a wide variety of industry sectors. The business has successfully handled cases in the property, services, construction, catering and automotive industries.

SOUTH EAST SNAPSHOT:
FRP ADVISORY

FRP Advisory’s focus on mid-market activity appears to have paid dividends in the South East region during the assessed period. The firm, topped the league for the South East region, handling some very high profile cases along the way. The administration of retailer Aquascutum received national media interest as well as recognition in the specialist retail trade press.

Also, the administration of group business BHSE General Partner Limited kept IPs Philip Armstrong and Philip Watkins busy. It
also delivered the firm a clutch of cases in one hit. Away from the property sector, the firm picked up work in the media and tourism sectors, handling The London Bridge Experience Limited and G2 Pictures Limited.

WALES SNAPSHOT:
KPMG

In January, Cardiff-based fashion group Peacocks announced its intention to appoint administrators. Richard Fleming, Chris Laverty Ed Boyle and Joff Pope were appointed joint administrators. Peacocks had operated 611 stores and 49 concessions across the UK and employed some 9,600 staff. By February, KPMG negotiated a deal with Edinburgh Woollen Mill, to safeguard 600 jobs.
Edinburgh Woollen Mill snapped up the Peacocks brand, 388 stores and concessions, as well as the business’ headquarters in Wales.

NORTHERN SNAPSHOT:
BEGBIES TRAYNOR

Begbies Traynor was founded in 1989 and has operating arms spanning finance, recovery, investigation and risk management.
Despite cutting its insolvency staff headcount by 6.2% in March 2012, the firm still managed to attract the largest number of administration cases both nationally and in two other sectors.

Cases included Jessops Restaurants Limited, managed by Kirstie Provan and Mark Fry, Fenhams Limited, managed by Gerald Krasner and Andrew Haslam and Harrogate Hygiene Services Ltd, a case managed by Andrew Mackenzie and Bob Maxwell.

In January 2012, Begbies offloaded its insolvency and restructuring division in the Channel Islands to Grant Thornton for £250,000. However, the group’s global risk partners division continues to maintain a presence in the Channel Islands.

MIDLANDS & EAST ANGLIA SNAPSHOT:
ZOLFO COOPER

Zolfo Cooper practitioners Peter Saville, Ryan Grant, Fraser Gray, Simon Wilson and Anne O’Keefe were among those IPs that ensured Zolfo Powered to the top of the league in this region.

There was some commonality in their sector strengths too. There was a healthy proportion of work in the retail and wholesale sector as well as cases in manufacturing, property, catering and construction sectors.

Zolfo has three service lines within the group: Financial advisory and restructuring services (FARS), corporate advisory services (CAS) and pensions advisory services (PAS).

This article is taken from the BlackBook 2013

The BlackBook 2013 (Administrations) has details of: – The top 150 IPs by workload – The top IPs in each English (and Welsh) region – The top IPs for each business sector – Documented IP creditor relationships – IP Memberships – IP contact details.

To order a copy click here or call 020 7940 4832 for more information.

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