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Despite recovery, more companies are at risk (D&B)


Close to 38,000 Australian firms are a high risk of distress this financial year, despite signs the Australian economy is on the mend.

New data from Dun & Bradstreet (D&B) shows that the number of firms at risk has continued to rise over the past fifteen months, from around 34,000 in Q2 2008 to almost 38,000 in the June quarter of 2009.

This increase leaves one in ten (10.2 percent) firms at risk of financial distress in the 12 months to the end of June 2010.

Coming on the back of more positive signs, including remarks by Reserve Bank Governor Glenn Stevens on Monday, this research highlights that despite improving economic and business conditions, the risk of Australian firms continues to shift.

D&B’s Economic Report meanwhile showed that Australia is set to ride out the crisis relatively well compared to other developed nations, while its Business Expectations Survey revealed that 44 percent of firms are expecting an increase in sales and one third are expecting an increase in profits in the December quarter.

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