Deloitte Ireland is forecasting there will be close to 900 insolvencies by the end of 2024.

Forecasts were upgraded from 800 to closer to 900 after a huge jump in the number of insolvencies in the Q3 of 2024.

SMEs were amongst the hardest hit as the rising cost of business has taken its toll.

There were 238 corporate insolvencies in Q3 2024, up 60% compared to the same quarter in 2023, according to new figures published by Deloitte.

This brings the total number of insolvencies in the first three quarters of 2024 to 650, up by 36% compared to the same period in 2023.

Commenting on the latest statistics, James Anderson, Turnaround & Restructuring Partner, Deloitte Ireland said: “In Deloitte’s last quarterly update we forecasted that Ireland was on course for more than 800 insolvencies in 2024, but it is now likely that it will be closer to 900.

"At the current activity level, corporate insolvencies in 2024 are on track to be 30% greater than 2023 with forecasted activity to be in line with 2017, which had 874 appointments.

"SMEs continue to be disproportionately affected accounting for 98% of activity levels.

"The hospitality and retail sectors accounted for 28% of activity levels in 2024 both of which significantly increased from the same period in 2023.

"These stark figures reinforce how the cost of doing business in Ireland in recent years has significantly increased. More tailored supports and reliefs are required to support SMEs in Ireland.”

The increase in insolvencies year-to-date Q3 2024 is driven by Creditor’s Voluntary Liquidation (CVL) activity, which saw a 38% increase compared with the same period last year.

Nearly all insolvencies in Q3 2024 were SMEs (98%), which is the same as H1 2024 corporate insolvency figures.

There have been nine Small Companies Administrative Rescue Process appointments in Q3, bringing the total to 22 in 2024 and saving 272 jobs.

The number of appointments is the same as 2023 but since its introduction, there have been 77 SCARP appointments.

Mr Anderson said: “I would encourage SMEs (and their advisors) to consider SCARP as a viable option to supporting businesses and saving jobs. The low number of companies using the process does not align with the positive impact and outcomes that the scheme has had.”

As in previous periods, the wide-ranging services sector accounts for the highest proportion of corporate insolvencies by the end of Q4 2023 with 237 insolvencies, representing 36% of total insolvencies recorded in the first 9 months of the year.

Within the services sector, financial services and holding companies account for the highest incidence of insolvencies with 76 so far in 2024.

Other notable services sub-sectors were Technical and Professional Services with 41 Insolvencies, real estate with 30 insolvencies and Entertainment with 20 insolvencies.

However, the hard-pressed hospitality sector continues to see significant increases in insolvencies – with 108 so far in 2024, which is 61% up from the same period in 2023 (67) and significantly higher than the same periods in 2021 and 2022 when there were just 26 hospitality insolvencies.

This is likely due to similar trends seen throughout the year, including increased labour and energy costs, as well as the VAT rate at 13.5% and insurance costs.

The remainder of the insolvencies were spread amongst the other sectors, with 74 in Retail, 67 in Construction, 33 in Manufacturing, 29 in Transport, 28 in IT, 19 in wholesale and the remainder in other business sectors.

As expected Leinster had the highest number of insolvencies in 2024 to date with 504 (78% of all insolvencies).

There were 82 (13%) in Munster, 55 (8%) in Connacht, and nine in Ulster (Republic of Ireland only).