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Almost one in four businesses in the North of England are financially stressed or distressed, according to new data.

Research from KPMG showed that across the five years to the end of 2018, the number of stressed businesses in the North of England increased to more than 1,000 鈥� the equivalent of approximately 19 per cent of the region鈥檚 business population.

Taking into account the growth in the volume of businesses of this size across the North in the period, the figures represent a 7 per cent annual growth rate in businesses experiencing financial 鈥榮tress鈥�.

However, the number of businesses facing more acute financial 鈥榙istress鈥� increased significantly in the same five year period 鈥� now standing at more than 200 鈥� providing some cause for concern among investors.

The compound annual growth rate of this category, at 10.5 per cent, is higher than any other 海角视频 region.

Rick Harrison, restructuring partner at KPMG in Manchester, said: 鈥淲hile the number of companies bringing in revenues of over 拢10million has grown by a quarter over the last five years 鈥� highlighting the underlying strength of the northern economy 鈥� there鈥檚 no doubt that such growth can bring with it significant challenges.

鈥淲hether it鈥檚 long-established companies battling against well-known economic headwinds, or those entrepreneurial scale-ups who are struggling to maintain a grip on cash flow during periods of rapid growth, the fact is that without action, stress can very quickly turn into distress.鈥�

Rick continued: 鈥淲hen we talk about 鈥榮tress鈥�, we typically mean companies which may have experienced instances of negative cashflow or working capital, defaulting on debt repayments or with a high debt-to-equity ratio. Taken individually, all can be relatively manageable. However, an accumulation of such factors can indicate a company is veering towards distress 鈥� and possibly insolvency.鈥�

Nationally, the figures showed 25 per cent of companies are financially stressed or distressed. In the North, the 鈥榮tressed鈥� element of that group is growing at a rate (7%) that is slightly slower than the national average of 7.7 per cent.

However, it is the growth in the 鈥榙istressed鈥� numbers within the North group (10.5 per cent) that stands out when compared to the national average of 8.9 per cent.

The sectors which bear the largest numbers of companies in financial stress and distress are retail, leisure & hospitality, building & construction, industrial manufacturing and consumer production.

Rick said: 鈥淭he fact that consumer-facing businesses, such as retailers, leisure businesses and those in the FMCG sector dominate our analysis of companies in stress and distress will come as no surprise.

鈥淢ix fragile consumer confidence with the burden of high rents, business rates and increased labour costs, and it鈥檚 clear that many of those who operate on the high street will continue to tread the fine line between stress and distress over the year ahead.鈥�