Businesses in Sheffield are displaying financial resilience in the face of continuing uncertainty over Brexit, according to the latest research from insolvency specialist Begbies Traynor.
The latest quarterly Red Flag Alert data released today (29 April) by Begbies Traynor reveals that the total number of businesses in the city displaying ‘significant’ distress in Q1 2019 since the final quarter of 2018 had risen by just 1%, with the total number of firms with ‘significant’ financial problems in the city standing at 3,572.
Year on year, distress among Yorkshire firms – and across the UK as a whole – had risen by 2%, while firms in Sheffield saw a 4% rise in the total number of distressed businesses. The ‘significant’ distress figures relate to businesses with minor CCJs filed against them, or those showing a marked deterioration in key financial ratios, and are often seen as early warning signs of more serious financial problems ahead.
Some industry sectors are faring worse than others in the city with real estate and property services showing a 19% increase in ‘significant’ distress year on year, affecting 328 businesses.
Leisure and cultural sector firms saw a 13% climb in distress levels year on year, with 189 businesses affected, while printing and packaging companies saw distress increase by 12% to affect 29 Sheffield companies in that sector.
Industries faring better in Sheffield included bars and restaurants, which saw a 4% decrease in distress year on year, and media firms, with a 9% year-on-year decrease.
Commenting on the latest Red Flag Alert figures, Kris Wigfield, managing partner at Begbies Traynor Sheffield, said: “Uncertainty continues to cast a long shadow over the economy with any potential agreement on a Brexit deal now kicked further down the road. In Sheffield, as across the economy as a whole, firms are quite sensibly hitting the brakes and putting on hold capital investment such as in new plant machinery or technology.
“While it is encouraging to see the apparent resilience of firms in the city, all businesses, and particularly SMEs, would do well to keep a tight rein on cash flow in this prolonged and unpredictable situation.”