More than 3,200 businesses in Cornwall found themselves in 'significant' financial distress during the second quarter of 2022 (April-June), according to the latest figures from Begbies Traynor's "Red Flag Alert," which monitors the financial health of British companies.

These figures represented a 1% decrease in the number of businesses struggling between Q1 and Q2 2022 and a 16% year-on-year fall on the same period in 2021.

However, when looking at the sector picture, there is evidence that some of the region's industries are continuing to struggle, with manufacturing and health & education experiencing the biggest quarterly increases, seeing 6% and 5% rises respectively between Q1 and Q2 2022.

Nationally, the latest Red Flag Alert research for Q2 2022 recorded 582,452 businesses in significant distress with companies continuing to be impacted by rising inflation, higher labour, material and energy prices, and faltering consumer and business confidence.

Evidence of this financial distress comes in the form of County Court Judgement (CCJ) data, arguably an early warning sign of future insolvency, which revealed 46,235 rulings in the first six months of 2022, up 5% on the first quarter, as creditors tried to recover debts.

This compares with 59,042 CCJs during the entirety of 2021, with this year’s figure to date driven higher as the backlog in the courts clears and debts are pursued.

Commenting on the figures, Scott Kippax, partner at Begbies Traynor in Cornwall, which has an office in Truro, said: "While the number of companies in distress has somewhat stabilised in Cornwall, a combination of economic issues have taken their toll to reduce both business and consumer confidence.

"Many businesses that are already struggling are fighting on in a climate of rising costs, but the environment is only going to get worse, not better, at least until next year.

"I fear that it will be a troublesome autumn as businesses which have struggled for so long are finally overwhelmed.

"That is why it is so important that any businesses facing financial difficulties, for whatever reason, should seek professional advice in order to fully understand the options available."