Styria records 13 percent rise in company insolvencies

Company insolvencies have increased slightly across Austria, with the sharpest rise in Styria, according to a projection by KSV1870 reported by ORF. From January through the end of September, 620 Styrian companies filed for insolvency, 13 percent more than in the same period last year.

That amounts to an average of two businesses a day. Only Vorarlberg recorded a larger increase among Austria’s federal states, with insolvencies up 43 percent.

Large failures drive up losses

Several major insolvencies in Styria caused liabilities to surge by 165 percent to 778 million euros. At the end of September last year, the figure was 293 million euros.

The largest failures among major business groups included Domaines Kilger, Wollsdorf Leder and ADA Möbelfabrik. Nearly 50 percent more employees also lost their jobs because of insolvencies than in the previous year, with 2,530 people affected.

Construction insolvencies rise sharply

Accommodation and catering, retail and construction continue to account for most insolvencies in Styria. Together, the three sectors currently represent slightly more than one-third of all company insolvencies.

Retail insolvencies fell by 9 percent compared with the previous year. Construction recorded the strongest increase, with almost 12 percent more insolvencies, while the number in catering rose by about 5 percent.

More failures expected by year-end

KSV1870 said weak economic conditions, subdued demand and high costs continued to weigh on businesses, with no strong recovery currently in sight. Rene Jonke, head of the organisation’s southern region, said the pace of insolvencies had increased in the third quarter and that the trend was expected to continue in the coming months. November and December were traditionally challenging for many businesses, he said.

KSV1870 expects between 800 and 850 company insolvencies in Styria by the end of the year, compared with 720 last year.

Further insolvency linked to Christof Industries

The Alpenländische Kreditorenverband, a creditors’ association, said on Wednesday that insolvency proceedings had also been opened against FMT Personalservice GmbH. The company, based in Wels in Upper Austria, is wholly owned by Christof Industries Austria GmbH, which recently filed for insolvency again in Graz.

The company’s liabilities are estimated at about 1 million euros. It is seeking to continue operating.