Insolvencies up more than 23% in July, new companies down 9%

Most significant increases in insolvencies registered in Algarve, Leiria and Vila Real

Insolvencies increased by more than 23% in July compared to the same period in 2022, confirming the upward trend since May, and company incorporations fell by 9%, according to data from Iberinform, released today.

“July has a total of 286 insolvencies, 54 more than in the same month last year, which confirms the upward trend that has been registered since May this year, with increases of 21%, 28% and 23%, respectively” the risk management company said in a statement.

The incorporation of companies registered until the end of July decreased from 3,711 in 2022 to 3,371, 340 fewer in year-on-year terms (-9.2%), and it was the second consecutive month in which values decreased compared to last year.

However, in the year to date, it appears that in the first seven months of 2023, 30,405 new enterprises were created, a total that exceeds the figures for 2022 (+4.1%) and 2021 (+24%).

Compared to 2022, insolvency declarations requested by third parties increased by 20% in the first seven months of 2023 (75 more requests), while insolvency declarations submitted by the companies themselves grew by 13% (48 more submissions).

Closures with an insolvency plan decreased by 8% compared to the same period last year, with a total of 23 actions. The same percentage decrease was registered in the closure of cases, which decreased from 1,552 to 1,429.

The accumulated number of actions registered until the end of July amounted to 2,341 insolvencies, 0.1% less than in the same period of 2022.

The districts of Lisbon and Porto had the highest numbers of insolvencies, 550 and 515, respectively, while Vila Real, Faro and Leiria registered the most significant increases (53%, 35% and 34%, respectively).

The most significant number of incorporations was in the district of Lisboa, with 10,293 new companies created by the end of July this year (+2.9% compared to 2022), followed by the district of Porto with 5,088 (+3.9%).

Conversely, the districts of Horta, Angra do Heroísmo and Bragança recorded the most significant decreases in constitutions, with decreases of 27%, 24% and 15%, respectively.