The Begbies Traynor Red Flag Alert report, which tracks key financial indicators such as profit retention, interest coverage ratios, and contingent liabilities, has recorded the highest level of business distress since its inception two decades ago.
A record number of UK businesses are facing significant financial distress, underlining the precarious state of the economy as Chancellor Rachel Reeves prepares to unveil her first budget.
This comes amid warnings from Moody's, the credit rating agency, that major water companies, including Thames Water, may buckle under growing debt burdens unless they are allowed to substantially raise customer bills.
Rising distress across industries have been driven by a sharp 20% rise in the number of utility companies at risk of collapse, along with retailer strain in the food and drug sectors.
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