You are currently viewing One in four companies in financial difficulty: one sector pays the heaviest bill

One in four companies in financial difficulty: one sector pays the heaviest bill

  • Post category:Economy News
  • Reading time:3 mins read

More than a quarter (27%) of companies are in difficulty today. They were 18% at the end of the covid crisis, according to estimates from GraydonCreditsafe relayed by L’Echo on Saturday. The analysis office examined the balance sheets of 460,000 companies as well as the evolution of payments of 2.5 million bills per quarter, with particular attention to energy bills and wages.

At least 115,000 companies have now burned their reserves, compared to 76,000 just under a year ago. The share of sound companies has shrunk from 47% to 39%, and the need for injection of funds has increased by 20 billion euros. A deterioration above all linked to energy prices, but the indexation of wages also plays a role.

It is the service voucher sector that pays the heaviest bill. Half of the companies there are now in the red zone. Horeca and the food industry follow, with four out of ten companies lacking funds to get through the crisis. GraydonCreditsafe pleads for aid at several levels, targeted rather than linear. For example, by relaunching notional interest (which the Federal government has just abolished) with interest rates linked to inflation, by fiscally stimulating the acquisition of minority stakes in companies in difficulty by companies in good health or even by primarily helping companies engaged in the green transition.

It’s a deadly cocktail

In RTL INFO 13H, Christophe Wambersie, the Wallonia-Brussels general secretary of the Neutral Union for Independents, commented on these figures.

“It’s the announcement of a chronicle that was planned in advance. Today, you add up the inflation in the price of supplies, the explosion in energy prices and the indexation that has already run in 2022. It’s a deadly cocktail for companies. At first, they scrape the bottom of the drawer using their reserves. And we know that companies, especially small ones, have problems of undercapitalization. They don’t don’t have the backbone strong enough to deal with such complicated situations. Inevitably, we are at the beginning of a wave and we are not yet on the crest of the wave. Things will get worse. The government must intervene to concretely help businesses.”

The authorities have already taken action. Will they make it possible to avoid bankruptcies? “A number of measures have been taken at the regional level. They are relatively weak and will only have a real impact on businesses in a few months. In the meantime, the situation will deteriorate further. For the other measures, this are buffer measures, which accompany the situation. We are asking for measures such as capping the cost of energy and making it possible to encourage the recapitalization of companies. This is essential. We are also asking for a reflection on the moratorium on bankruptcies. There are solutions that cost money, but that’s the price to pay to save our businesses.”