Corporate insolvency ‘should drop over Christmas’ in hospitality and leisure

Published on October 17, 2012 by Crawfords Accounting

The beleaguered hospitality and leisure sector should see some respite in its rate of corporate insolvency over the Christmas period, according to one business analyst.

David Chubb, business recovery partner and hospitality and leisure specialist at PricewaterhouseCoopers, says the festive period often gives a boost to those working in the sector.

And with insolvencies down over the course of 2012 – albeit from a relatively high starting point – the picture is bright as we approach the new year.

Mr Chubb says: “Most of the businesses will be looking for an uplift in performance over the Christmas period and therefore I would expect a further drop in insolvencies for the next quarter.”

Some parts of the sector are performing better than many people might expect – such as campsites, which saw a zero rate of corporate insolvency in the past quarter, despite the inclement weather conditions that have prevailed throughout 2012.

However, the gambling segment had an unusually high number of insolvencies in the third quarter, although the very small number of companies that experience trouble in this market mean there is much more scope for sizeable swings – in this case, just four companies went bust, but that still represents about twice as many as in a typical quarter.

With insolvencies generally down across the hospitality and leisure sector, however, it could be a bright Christmas for many as the seasonal rush in celebrations and festivities adds to incomes across the UK.

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