Proline Group were one of three unsecured creditors losing over £1 million when Herbert T Forrest went in to Administration, with a total of 578 unsecured creditors losing over £22 million. 

Greg Connell, Managing Director of InfolinkGazette said, “such is the contagion effect of insolvency, that unsecured creditors are 3.5 times more likely to become insolvent than the general corporate population”. 

Figures released by InfolinkGazette, reveal two colossal Deliberate Tax Defaulters, published by HMRC in the final quarter of 2018. Universal Payroll Services Ltd and Universal Project Services Ltd, have incurred combined penalties of almost £11.8 million on unpaid taxes of almost £20 million. 

Greg Connell commented: “HMRC publish details of offences, which may have gone undetected for years; cases only end up on the list after the company has been given an opportunity to make representations about whether it should be published, and these particular offences occurred between 2010 and 2014.” Greg added, “it’s a shame HMRC doesn’t publish more of their default data, any of us could be supplying credit to a customer who hasn’t paid last year’s Corporation Tax, and the first we will know about it, is when HMRC petition for the winding up." 

A London Stock Exchange Profit Warning is a declaration issued by a listed company to investors through the London stock exchange, normally in a trading update. It warns investors that the profit of the company in the coming quarter, half year, or full year, will significantly decline when compared with that of the same period of previous year, or be significantly below guidance. 

Investors should be aware of the possible loss when buying or selling its stock because share prices often fall following a profit warning being issued. Creditors should also be wary because it may impact on banking covenants, credit insurance limits, or in the case of Patisserie Holdings, the very future of the business. 

Figures released by InfolinkGazette, revealed 28 London Stock Exchange Profit Warnings during January 2019. Greg Connell commented: “Credit Insurers are quick to act on profit warnings, they don’t necessarily withdraw cover after the first profit warning, but they tend to react quickly to a second warning as demonstrated by Debenhams and Footasylum.”

• The second profit warning from Footasylum, blaming promotional activity and discounting across the retail sector; 
• Halfords, citing exceptionally mild weather and ongoing weak consumer confidence; 
• Provident Financial, blaming the rise of bad loans at its credit card lender Vanquis; 
• Patisserie Holdings plc, citing fraud, and subsequently went in to Administration; 
• A second profit warning from airline Ryanair Holdings PLC, blaming Lower winter fares, which are expected to fall 7%; 
• Metro Bank, citing an accounting error; 
• Watchstone Group PLC the company formerly known as Quindell reported a 16% fall in annual revenue. Slater and Gordon served a claim against Watchstone Group over the ill-fated 2015 acquisition of its professional services arm. Watchstone claims that Slater & Gordon's allegations of deceit and the associated breach of warranty claim are wholly without merit, but significant costs have been incurred in defence of this claim and they continue to pursue any deferred consideration due from Slater & Gordon in respect of the disposal of the PSD. The SFO investigation continues. 
  

Greg Connell commented: “trade suppliers have had to deal with a slowdown in global growth, and Brexit uncertainties for some time, but they are also having to deal with fallout from corporate fraud and accounting irregularities. Add in the insolvency contagion effect and the beginning of 2019 might be a good time for suppliers of goods and services to review their credit insurance cover.”