By Adria Calatayud
A total of 650,000 U.K. businesses faced significant financial distress in the second quarter of 2021, a 10% decline from the first quarter, according to data published by corporate-restructuring specialist Begbies Traynor Group PLC on Wednesday.
The reopening of the economy after coronavirus-related lockdowns allowed some companies to pay down some of their more critical debt and avoid court action, Begbies Traynor said.
The number of U.K. businesses in significant financial distress in the quarter was 24% higher than in the year-earlier period and was the second-highest distress level recorded after the peak of the first quarter, Begbies Traynor said. The real-estate and property, financial-services and travel and tourism sectors experienced on-year increases in the numbers of significantly distressed companies.
Begbies Traynor defines significant distress as those business with county court judgments--a court order ruling that a debt must be paid--of less than 5,000 pounds ($6,938) filed against them or which have been identified for a sustained or marked deterioration in key financial ratios and indicators.
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(END) Dow Jones Newswires