More building sector businesses go bust
The number of construction industry companies opting for controlled insolvency is on the rise, figures presented today (Tues) show.The Austrian Creditors Protection Association of 1870 (KSV 1870) said 204 building firms went bust in the first three months of this year, around 31 per cent more than in the same time span of 2010.Only some weeks ago, Viennese think tank Institute for Economic Research (WIFO) warned that the domestic construction sector may experience difficulties this year. WIFO said it expected investments in the Austrian building industry to edge up by 0.7 per cent in 2011, while the gross domestic product (GDP) may rise by 2.2 per cent.KSV 1870 also said today that 26 per cent more gastronomy sector businesses went bust in the first quarter of 2011 than in the same period of 2010. The organisation stressed that sectors which struggled through the economic downturn of 2008 and 2009 seemed to recover. KSV 1870 explained that there were fewer bankruptcies in the machinery and metal industry in the first three months of this year than during the same time of last year.The number of opened bankruptcy proceedings in Austria edged up by four per cent from the first quarter of 2011 to the same time span of last year. Around 5,500 employees were affected by the insolvencies, down by 13 per cent on the year. Firms which went broke between January and March 2011 had debts of althogether 540 million Euros, down by 15 per cent.Around 23,600 employees were affected by the 6,366 business bankruptcies which occurred in Austria in 2010. Almost eight per cent more insolvencies were recorded in 2009.Real estate company R-Quadrat (84.2 million Euros) was the biggest bankruptcy in the first quarter of this year as far as the amount of debt is concerned. Software developer JoWooD Entertainment AG (JoWooD) which plans to restructure and continue doing business took second place in this unpopular ranking with debts of 22 million Euros.One of the most recent cases of a firm opting for insolvency proceedings was Sattledt-based solar technology specialist SOLution Solartechnik (SOLution). Company bosses argued that an “unforeseeable” decrease in turnover and fewer subsidies for renewable energy models forced them to file for bankruptcy. KSV 1870 said SOLution had assets of 555,000 Euros, while its debts ranged around 3.7 million Euros. Thirty-three staff and 150 creditors are affected by the insolvency.Federal capital Vienna registered the highest number of business bankruptcies in the first three months of this year with 268. This is a 14 per cent increase compared to the first quarter of 2010. The western region of Vorarlberg recorded the strongest rise among Austrias nine provinces with 29 per cent.KSV 1870 also announced today that the number of households opting for controlled bankruptcy procedures rose by nine per cent to 2,453 cases.