Fewer companies bite the dust

25 October 2011

Fewer companies closed down in September 2011 compared to the same month last year, Statistics South Africa reports.

“The number of liquidations reflected a year-on-year decrease of 3.2 percent (from 341 to 330) in September 2011,” the agency said on Monday.

Stats SA said liquidations took place when the affairs of a company or close corporation were wound up because its liabilities exceeded its assets, and the matter was resolved either voluntarily or by a court order.

The number of liquidations for the first nine months of 2011 fell 15.5 percent year-on-year – from 2 930 to 2 475.

“This decline was due to a 16.2 percent drop in voluntary liquidations and a 5.5 percent drop in compulsory liquidations,” Stats SA said.

Over this time, company liquidations declined 16.7 percent – from 1 364 to 1 136 – and close corporation liquidations were down 14.5 percent – from 1 566 to 1 339.

Insolvencies – where an individual or partnership is unable to pay debt and is placed under final sequestration – declined in August, Stats SA said.

Insolvency figures are issued a month later than liquidation figures.

“A year-on-year decrease of 27.8 percent (from 352 to 254) was estimated for August 2011,” Stats SA said.

The total number of insolvencies for the first eight months of 2011 decreased by 33.8 percent – from 2 642 to 1 750 – compared with the first eight months of 2010.