Miton UK MicroCap Trust plc (LON:MINI) Co-Fund Manager Gervais Williams was asked by DirectorsTalk his thoughts on Begbies Traynor Group plc (LON:BEG).
DirectorsTalk asked, “In the professional services sector, Begbies Traynor specialises in corporate restructuring. It’s announced a good pipeline of engagements on the financial advisory and insolvency side, how do you view the company?
Gervais Williams commented:
“It’s likely to be very busy to be honest, I think insolvency is going to be a really big problem, unfortunately some companies are going to fail and Begbies Traynor will be busy with that.
What’s interesting about them is actually a lot of their revenues are only recognised once the asset has been sold and I think it’s going to get harder to sell some of these private assets so there may be delays in cash flow coming through.
I like the company, I think it’ll be busy but we’ve actually taken out profits on that one recently.”
In the UK Government’s March 2023 insolvency report, it noted, the number of registered company insolvencies in February 2023 was 1,783:
- 17% higher than in the same month in the previous year (1,518 in February 2022), and
- 33% higher than the number registered three years previously (pre-pandemic; 1,345 in February 2020).
The graph below shows the historical trend of company insolvencies covering the past four years.
