One in seven construction companies could disappear if the market downturn deepens, a report has warned.
In its report, analyst Plimsoll Publishing examined figures from the top 2,000 construction companies in the UK and said an increased reliance on short-term finance was behind its forecast.
The report said: 鈥淢ore than a third of firms have a greater need for short-term finance. This is doubly dangerous at a time when banks are looking at their loan books and it puts companies in an even more vulnerable position.鈥�
Plimsoll also found that a third of companies showed signs of recessionary behaviour and reported declining sales. More than half reported tightening margins, and out of these 17 were running at a loss.
A greater need for short-term finance puts firms in a vulnerable position.
Plimsoll publishing report
Meanwhile, a report by insolvency specialist Begbies Traynor has found that 565 firms experienced 鈥渃ritical problems鈥� in the first quarter of 2008, compared with 201 last year.
Copies of the report are available for 拢350 by calling 01642-626422. Readers can request a 拢50 discount.
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