Slightly more than 1,000 Western Australian companies had external administrators appointed in the 12 months to May this year, an increase of 29 per cent on the previous period, according to the latest numbers from the Australian Bureau of Statistics.
In the month of May, 74 companies had appointments, with 11 of those voluntary, 18 court wind-ups and 40 creditor wind-ups.
That compared with 66 last May, although it’s well down from a record 102 in August 2015.
Nationally, there were 735 appointments in May, taking the 12-month total to 10,115, an increase of 12.8 per cent.
FTI Consulting senior managing director (corporate finance and restructuring) Ian Francis said the pain was continuing in the mining states of Western Australia and Queensland, with both reporting company insolvencies significantly higher than the national average.
“These economies are transitioning away from a reliance on mining as the boom is clearly over,” he said.
“The next phase in the mining downturn is playing out – mining and mining services companies have been under pressure for some time and we are now seeing the related impact on the property sector.
“The property sector is undergoing a major correction and here at FTI we are seeing a number of forced insolvencies, particularly in regional towns in WA and Queensland, which have been driven by forced sales and increasing pressure on rents and property prices.”
Mr Francis added that, viewed in isolation, April showed tentative signs of stabilisation, although there would need to be a sustained reduction on the months ahead to break a clear trend of rises.
