Over one in four companies face failure

Citation

(2002), "Over one in four companies face failure", Anti-Corrosion Methods and Materials, Vol. 49 No. 6. https://doi.org/10.1108/acmm.2002.12849faf.004

Over one in four companies face failure

Over one in four companies face failure

Keywords: Metals, Coatings, Industry

Over one in four companies in the UK Metal Treatments industry are being forced out of the market according to new research by financial analysts Plimsoll Publishing Ltd. Plimsoll has placed these 285 companies in the dreaded “Danger” financial rating in their latest analysis.

The new study, based on the top 1,000 companies in the industry, gives each company one of five groups based on their financial standing over the last 4 years. Companies are rated as Strong, Good, Mediocre, Caution or Danger. The basis of this rating system is to easily spot good performance from the bad.

“I believe the Metal Treatments industry has too many companies chasing too little market,” says David Pattison, senior analyst at Plimsoll. “These companies (rated as Danger) have been in decline for years with a combination of increasing debts and low margins. Many of these companies are at a stage where their debts are severely restricting the ability of the management to make even normal business decisions,” concludes Pattison.

Plimsoll Publishing has been rating companies on overall performance since 1987. In another study by Plimsoll, 84 per cent of 58 recent company failures in the Metal Treatments industry were rated as “Caution” or “Danger” up to 2 years prior to their demise.

Plimsoll’s latest 3rd ed. 2002 proves it is not all gloom and doom out there. Three hundred and sixty one companies were given a “Strong” rating. Benefiting from less debt, stronger balance sheets and average margins at a healthy 7.1 per cent. These companies are worthy of envy.

To find out if your company is named in the Metal Treatments Analysis or to order a copy of the full report for £305 contact Plimsoll. Readers of this publication can receive a 5 per cent discount if mentioning this article upon ordering.

Details available from: Plimsoll Publishing Ltd, Tel: +44 (0) 1642 626400; Fax: +44 (0) 1642 626410; E-mail: plimsoll@dial.pipex.com; Web site: www.plimsoll.co.uk