Higher costs and waning demand hit earnings, adding strain on companies already contending with rising debt costs
The A&M Distress Alert assesses performance and balance sheet robustness of European businesses, aiming to identify those that are in financial distress or may soon be heading in that direction.
The latest alert finds that corporate distress in Europe has risen to 9.8% in 2023, up from 8.6% recorded in 2022, reaching the highest level since the start of the pandemic in 2020. The percentage of businesses lacking robustness and performance have both increased in 2023, reaching the highest levels since 2020.
Business' weakening performance played a larger role than before in pushing levels of financial distress higher as they face the impact of inflation, squeezed earnings due to elevated operating costs, higher labour and energy costs, and decelerating consumer demand.
Discover more about the sector and regional findings in the latest report.
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Originally published 02 Febrary 2024
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