H1 profits hit at Begbies Traynor

The firm, which issued a trading update for the six months to October 31, said insolvency revenues are about nine per cent lower, mitigated by an improved performance elsewhere in the business.

This is in line with its trading update issued on September 30, when it said that insolvency activity levels had been constrained due to market conditions, which the firm later said was backed up Government statistics.

Profitability has been hit by reduced margins in insolvency but partially offset by improved performance in the non-insolvency businesses.

For this reason, and because of an increase in finance costs resulting from the firm's new banking facilities, adjusted pre-tax profits in the first half year to be around 700,000 below last year's results of 4.3m.

After some restructuring, exceptional costs of about 800,000 have been incurred in the half year, it said. H1 results are out on December 16.

Begbies said it was comfortably within its banking facilities of 35m with net debt (excluding asset finance) of 20.3m. Total net debt, including all sources of finance, was 24.2m at October 31.

It said it expects an "incremental" flow in new insolvency work as the public sector cuts ebgin to hit.