In 2021, the number of bankruptcies required by companies analyzed, according to the date of the declaration order, has been 39, 0.8% of the total, and presumably these are bankruptcies requested prior to the entry into force of the first bankruptcy moratorium. , which ended yesterday, but whose start has been delayed for extraordinary reasons, according to the annual statistics published by the Association of Property and Commercial Registrars, with the scientific advice of the UAB.
Despite the inadmissibility of the bankruptcy proceedings requested by the (necessary) creditors, the total number of bankruptcies in 2021 has increased by 25%.
However, the liabilities affected by bankruptcy proceedings decreased by almost 58% compared to 2020, as well as the total number of workers affected by 31%.
The typical insolvent company continues to belong to the service sector (not real estate), starts the procedure ten years old, and has more than five employees hired. This year, however, his liabilities only slightly exceed 200,000 euros, well below the 300,000 in 2020 or almost 600,000 in 2015.
The financial situation of the companies initiating the procedure (voluntary in 98% of cases) continues to be quite deteriorated: more than two thirds reflect net losses (negative year-end result) and more than half of them The repayment of the debt cannot even be considered due to its lack of generated resources (the result of the year plus amortizations and provisions also offer a negative result).
44.3% of bankrupts show negative own funds, that is, they lack any assets. Just over 18% would have sufficient financial capacity to comply with an approved agreement within the usual limits of the Bankruptcy Law.
In 2021, the proportion of bankruptcies of companies in the construction cycle remains stable at over 20%, far from the 27.2% of 2017 or the most distant 48.3% of 2008. Of the total bankrupts, they belong to the sector of non-real estate services 66.5% of the companies.
In 2021, and already as a structural characteristic of the procedure, of the 1,899 successive phases initiated (agreement or liquidation), 86.6% (85.5 in 2020) were direct liquidations, and 8.4% (8.3 in 2020) settlements from failed restructuring attempts.
In more than 2,700 cases (1,700 in 2020), the bankruptcy is opened and concluded simultaneously, due to insufficient resources of the debtor to cover the bankruptcy procedure.
In relation to the collection expectations of ordinary creditors (and always under the assumption of full compliance with payments), the median collection expectation of debts in 2021 was 47.5%, very similar to the two years precedents (47.6%), with one point of difference between early agreement proposals, that is, without the need to hold a creditors’ meeting, and those that follow the usual procedure.
In 25% of cases, this expectation of collection is greater than 65% of the debts, and more than 96% would only be repaid in 5% of the approved agreements.
Contest Duration
Differentiating by type of processing, in abbreviated bankruptcies the successive phase (liquidation or agreement) begins in less than a year in 61% of cases (66.4% in 2020, and 62.3% in 2018), while that in the ordinary ones that term is only met by 48% (46.6 in 2020). Whatever the processing, the procedure is typically faster in those contests requested by the debtor, that is, voluntary.
In 2021 it has been estimated that the typical abbreviated bankruptcy (liquidation) takes 65 days to conclude, 1,601 days if we exclude those with the conclusion of the bankruptcy simultaneous to the declaration (express bankruptcies); while the ordinary ones require 2,716 days (2,512 in 2020, 2,077 in 2019, 2,009 in 2018 and 1,698 in 2017). Most of this time is consumed in the liquidation phase, thus being unrelated to procedural issues.
The existence of two consecutive orders for the opening of a successive phase (agreement and liquidation) extraordinarily extends the common phase in abbreviated processing (218 more days), the difference being even greater in ordinary bankruptcies (316 more days).
In this yearbook, no positive association is observed between the size of the bankrupt and the duration of the common phase (prior to the agreement or liquidation, therefore, time entirely attributable to the procedure and not to corporate operations such as liquidation).
Although, it is in the group of longest-running bankruptcies where we find the 5% of the largest companies in the entire sample, with liabilities of more than 53 million euros, when the typical liability of this group stands at 6 ,2 million euros.
Construction Cycle
With a notable increase in the number of companies declared bankrupt, the construction cycle maintains its representativeness this year, with a total of 20.75% of the sample, a figure in decline until 2020 (20.5% in 2020, 23.1 % in 2019, 27.3% in 2017, 32.8% in 2015, 41.1% in 2013).
Of the total liabilities affected in 2021 (more than 3,400 million, compared to 8,100 million in 2020, or 7,700 in 2019), the participation of construction rebounded strongly to 34% of that amount (15.8% in 2020 ).
In a similar way to previous years, real estate companies reflect the worst levels of viability: in case of generating positive resources (41% of the cases) they would require 16 years to meet all their liabilities.
However, this perspective has improved significantly compared to previous years (25 years in 2020, 33 in 2019, or 28 in 2018). The typical company in the Construction subsector with positive generated resources, 49% of the total, would take 10 years (13 in 2020, 15 in 2019) to service all its debts.
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