UK businesses in 'critical' financial distress in Q1 2025 increased by 13.1% compared to Q1 2024. The latest "Red Flag Alert" report from Begbies Traynor highlights how tens of thousands of UK businesses are struggling. As of 31 March 2025, 45,416 businesses were in 'critical' financial distress—a 13.1% rise compared to Q1 2024. Nearly two-thirds (14 of 22) of sectors covered by Red Flag Alert experienced a double-digit percentage increase of companies in 'critical' financial distress over the last year, with the most concerning picture in the UK's consumer-facing economy where 'critical' financial distress leapt across Bars & Restaurants (+31.2%), Travel & Tourism (+25.5%) and General Retailers (+12.4%). In addition, Begbies Traynor also found that, despite an 11.5% decrease during the first quarter of 2025, levels of 'significant' distress rose 4.5% in the last twelve months. To read Begbies Traynor's news release, go to https://www.begbies-traynorgroup.com/news/business-health-statistics/red-flag-alert-report-q1-2025-uk-businesses-under-pressure-ahead-of-impending-tariff-and-tax-changes.

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March's corporate insolvency figures were 9.1% higher than a year ago. The latest data from the Insolvency Service has found that corporate insolvencies in England and Wales decreased by 2% in March 2025 (to 1,992) compared to February 2025's total but increased by 9.1% compared to March 2024's figure. President of R3, Tim Cooper, commented: "The slight month-on-month reduction in corporate insolvency numbers is due to a fall in Compulsory Liquidations compared to last month's figures. However, the corporate insolvency statistics published today are higher than they were a year ago and show that demand for insolvency support and the number of firms entering insolvency processes are still high." To read R3's new release, go to https://www.r3.org.uk/press-policy-and-research/news/more/32428/r3-responds-to-march-2025-insolvency-statistics/.

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Corporate closures climb: Over 1,100 businesses shut in early 2025. According to an analysis of published insolvency notices compiled by City AM, businesses across Britain are being shut down at a rate not seen since the financial crash. More than 1,100 companies have faced winding-up orders in the first fifteen weeks of 2025, an increase of nearly a quarter compared to last year and the fastest rate of corporate closure since 2010. Almost 2,200 businesses have also faced winding-up petitions, an increase of more than a fifth since 2024 and the highest rate since 2012. The analysis also found that over one in ten of the more than 300 companies facing winding-up petitions in April alone were retail and hospitality businesses. To read City AM's article, go to https://www.cityam.com/company-closures-surge-amid-fears-over-health-of-uk-economy/.

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EY flags the impact of contract and order cancellations in Q1 Profit Warnings. EY-Parthenon's latest Profit Warnings report has found that UK-listed companies issued 62 profit warnings during Q1 2025, an 11% year-on-year fall. However, the proportion of listed firms to warn in the last 12 months remains high (18%). EY-Parthenon found that the leading factor behind profit warnings in Q1 was contract and order cancellations or delays, cited in 40% of warnings—the highest percentage recorded for this cause in twenty-five years of EY's analysis. Policy change, geopolitical uncertainty (26%), and labour market issues (18%) were cited as the other main drivers for warnings during Q1. 50% of the profit warnings issued by UK-listed businesses in April cited the direct or indirect impact of tariffs and the resulting recent global trade disruption. To read EY's news release, go to https://www.ey.com/en_uk/newsroom/2025/05/ey-parthenons-latest-profit-warnings-q1-2025.

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The number of UK retail sector insolvencies in 2024 stood 47% above its (pre-COVID) 2019 reading. Company Watch has published a whitepaper analysing the financial health of the UK retail sector, which finds that March 2025 data points to ongoing financial strain, with 62,899 of the 141,182 active retailers (41%) falling into the Warning Area (H-Score® ≤ 25). Although this is a slight improvement from 44% in November 2024, the sector remains under pressure. Smaller businesses are especially exposed—57% of companies with assets under £25,000 fall into the high-risk category, compared to just 21% of those with assets exceeding £1 million. The paper concludes that an increase in the number of retail sector insolvencies in 2025 seems likely and notes that in 2024, the number of retail sector insolvencies stood 47% above its (pre-COVID) 2019 reading. To view the whitepaper, go to https://blog.companywatch.net/resources/industry-insights-retail.

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April insolvency data: Easing marginally but still above pre-pandemic norms. New data from Creditsafe has found that April's insolvency data paints a picture of both struggle and resilience. 2,483 businesses across the UK and Northern Ireland declared insolvency in April 2025—a 14% decrease from March and broadly unchanged compared to the same month last year. However, while the month-on-month decline suggests a short-term easing, the flat year-on-year figures signal that underlying pressures on UK businesses remain firmly in place. Insolvencies continue to trend above pre-pandemic levels, driven by persistent economic headwinds. The construction sector continues to top the table, accounting for 16% of all insolvencies in April. To view Creditsafe's findings, go to https://www.creditsafe.com/gb/en/blog/reports/insolvencies.html.

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Serious questions are raised about reported payment practices. Good Business Pays has warned that new research raises serious questions about the accuracy of payment data and, therefore, the authenticity of payment data reported by companies as part of their statutory duties. Good Business Pays surveyed over 500 Accounts Payable professionals in large UK companies responsible for supplier payments. Key findings from the respondents were: 63% think a quarter of the supplier records in their supplier system (BSM) are wrong, 24% say half or more of the supplier records in their system are incorrect, 23% can't identify who the SMEs are in their supplier records, and 66% rely on their suppliers to keep their records accurate and up to date. Terry Corby, Founder and CEO of Good Business Pays, said: "With the government planning to bring in regulations for big companies to publish their supplier payment terms in their annual reports from 2026, it's shocking to see such a high level of uncertainty around the accuracy of supplier data used every day in large companies." To read Good Business Pays' news release, go to https://goodbusinesspays.com/posts/major-flaws-exposed-in-latest-uk-business-payment-data/.

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​​​​​UK Economy

Trade uncertainty is set to weigh on UK growth over the next two years. The EY ITEM Club has downgraded its GDP growth expectations for 2025 to 0.8%, down from the 1% predicted in February's Winter Forecast, and has revised its 2026 forecast down from 1.6% to 0.9%. This caution is expected to continue into 2026 and will be combined with the longer-term effect of tariffs on businesses and consumers. The EY ITEM Club Spring Forecast assumes that the US will operate with an average tariff rate of more than 20% for much of the world, which is expected to make it challenging for some UK exports to reach key markets, weakening goods demand and restraining growth. The EY ITEM Club still expects the UK to return to more moderate levels of GDP growth of 1.5%, but this is now forecast to happen in 2027 rather than in 2026. To read EY's news release, go to https://www.ey.com/en_uk/newsroom/2025/04/trade-disruption-limits-uk-growth.

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IMF slashes UK growth forecast as tariffs create 'significant slowdown'. City AM has reported that the IMF has downgraded its UK growth forecast by 0.5% this year as President Donald Trump's trade war brings global tariff rates to "centennial highs". The IMF said the UK economy would grow by 1.1% this year and 1.4% next year, reflecting leading forecasters' worries about the ongoing global trade war between the US and China. The IMF's last forecast in January predicted the UK economy to grow 1.6% in 2025 and 1.5% in 2026. UK Chancellor Rachel Reeves saw a silver lining as the IMF took a more aggressive view on its growth outlook for France and Germany. "This forecast shows that the UK is still the fastest-growing European G7 country," Reeves said. To read City AM's article, go to https://www.cityam.com/imf-slashes-uk-growth-forecast-as-tariffs-create-significant-slowdown/.

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NIESR revises down its forecast for UK GDP growth in 2025 to 1.2%. The National Institute of Economic and Social Research's (NIESR) latest UK Economic Outlook warns that the UK economy is struggling to escape from an impasse of sluggish economic growth and persistent inflation. Against this backdrop, NIESR's Spring 2025 UK Economic Outlook projects lower GDP growth and higher inflation than at the time of its Winter Economic Outlook in February, with GDP growth of 1.2% this year and 1.5% in 2026, while inflation is projected to average 3.3% in 2025 and return to target more gradually over the next three years. NIESR also believes that the UK government is not on track to meet its fiscal rules and cautions that a weaker economic outlook and lower projected tax receipts are set to erode the limited headroom over the course of the parliament. To read NIESR's news release, with a link to the full report, go to https://niesr.ac.uk/publications/uk-outlook-spring-domestic-issues-stifle-growth?type=uk-economic-outlook.

 

UK GDP is estimated to have grown by 1.4% in the three months to February 2025, compared with the same three months in 2024. The latest Office for National Statistics (ONS) data estimates that monthly GDP grew by 0.5% in February 2025, with growth in all main sectors. These results are an improvement compared to January 2025, which showed no growth (revised up from a fall of 0.1% in the ONS' previous publication). GDP is now estimated to have grown by 0.6% in the three months to February 2025, compared with the three months to November 2024, mainly because of growth in the services sector. Production sector output also rose by 0.7%, although construction showed no growth. Looking over the longer term, GDP is estimated to have grown by 1.4% in the three months to February 2025, compared with the three months to February 2024. To read the ONS' news release, go to https://www.ons.gov.uk/economy/grossdomesticproductgdp/bulletins/gdpmonthlyestimateuk/february2025. Licensed under the terms of Open Government. Licence v3.0.

 

UK high street sales continue to struggle in a disappointing April​. The latest report from BDO shows that UK retailers continue to struggle to drive consumer spending on the high street, with sales in-store increasing just +2.3%, compared to a negative base in April 2024 of -1.7%. Not only does this mean that in-store sales have barely recovered from last year's poor performance, but it also means that actual sales volumes shrank, as this is once again below the rate of inflation. The lifestyle and homewares sectors recorded particularly poor performances in-store. In-store sales declined by -1.2% in the lifestyle sector, with in-store sales in the homeware category growing just +0.9% compared to a negative base of -1.5% in the same month last year. Similarly, Fashion sales in-store grew by +5.2%, but this is against a base of -8.3% in April 2024, meaning that the category has failed to recover from this poor performance. To read BDO's news release, go to https://www.bdo.co.uk/en-gb/news/2025/high-street-sales-continue-to-struggle-in-disappointing-april.

 

Almost two in five mid-sized businesses plan to export more this year. According to the latest research from BDO, expanding or exporting overseas is a top priority for nearly one in three (32%) mid-sized businesses over the next year, despite complex international trade conditions. BDO's survey of 500 mid-sized business leaders suggests they have been planning for supply chain disruption and new international tariffs by working to build new routes into international markets. Almost two in five (37%) expect to increase exports in the next year, rising to over half of businesses in the retail and wholesale (52%) and technology (56%) sectors. Many are targeting more sales towards Africa (35%), Australia (38%), and Asia (30%). Europe also remains a healthy market for UK mid-sized businesses, with 41% planning for more exports to flow to the European Union during 2025. To read BDO's news release, go to https://www.bdo.co.uk/en-gb/news/2025/uk-mid-sized-businesses-target-new-international-trade-routes-amid-shifting-landscape.

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Only a fifth of UK SME exporters saw increased overseas sales in Q1 2025. BCC's latest Trade Confidence Outlook has shown that the percentage of UK SME exporters reporting increased exports remained depressed ahead of the introduction of US tariffs. Overall, 21% of SME exporters reported an increase in export sales, 27% reported a decrease, and 53% reported no change. The position for advance orders was even less optimistic, with 20% of SMEs reporting an increase, 52% no change, and 28% a decrease. According to the BCC, SME exporters are consistently more likely to report decreased exports than before the pandemic and Brexit. BCC notes that in Q2 2018, only 14% of SME exporters reported a decrease in overseas sales; in Q1 2025, it stands at 26%. However, by contrast, domestic demand for SME exporters remains consistently more buoyant, with 28% reporting an increase in domestic sales in Q1 2025, against 21% for overseas sales. To read BCC's news release, go to https://www.britishchambers.org.uk/news/2025/04/increased-export-volatility-ahead-of-tariffs/. 

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UK mid-sized businesses target new international trade routes. According to the latest research from BDO, expanding or exporting overseas is a top priority for 32% of mid-sized businesses over the next year. BDO's survey suggests they have been planning for supply chain disruption and new international tariffs by working to build new routes into international markets. 37% expect to increase exports in the next year, rising to 52% of businesses in the retail and wholesale and 56% in technology sectors. Many are targeting more sales towards Africa (35%), Australia (38%), and Asia (30%). Europe remains a healthy market for UK mid-sized businesses, with 41% planning for more exports to flow to the European Union over 2025. BDO also notes that UK mid-sized businesses may be buoyed by the Government increasing the amount some companies can borrow from the British Business Bank's Growth Guarantee Scheme or UK Export Finance's Export Development Guarantee. To read BDO's news release, go to https://www.bdo.co.uk/en-gb/news/2025/uk-mid-sized-businesses-target-new-international-trade-routes-amid-shifting-landscape.
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Global: Late Payment, Insolvencies & Global Economy

Nearly a quarter of European business leaders worry they could be forced to shut down within the next two years if economic conditions do not improve. Intrum's latest European Payment Report 2025 underscores the urgent need for economic recovery in Europe and the critical role that timely payments play in this process. Key findings include that nearly a quarter of business leaders worry they could be forced to shut down within the next two years if economic conditions do not improve. This could put an estimated 10 million companies at risk. In addition, despite better-than-expected performance in 2024, nearly half of the executives surveyed report that their revenues are not recovering as quickly as anticipated. To protect commercial relationships, 56% of executives have accepted unfavourable payment terms, and almost half have accepted longer payment terms. Over a third of executives said that payment delays have still not returned to pre-pandemic levels, with 11% of revenues typically paid late. To read Intrum's news release, go to https://www.intrum.com/press/press-releases/press-release-article/?id=40724231-127d-4c21-9211-7d598dc5f407#Intrums_European_Payment_Report_2025_AI_can_play_a_critical_role_in_economic_recovery_urgently_needed_across_Europe.

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The trade war will lead to a significant slowdown in global GDP growth. Allianz Trade has released an update to its Economic Outlook, warning that the ongoing trade will lead to a significant slowdown in global GDP growth, which is expected to drop to just +2.3% in 2025—the lowest level since the pandemic. The US economy is now forecasted to enter a mild recession, with a cumulative decline of -0.5% from Q1 to Q3, followed by weak growth of +0.8% in 2025. The Eurozone will also experience lower growth, with projections of +0.8% growth in 2025, followed by a modest recovery to +1.5% in 2026. Similarly, Allianz Trade predicts that the UK will see growth fall to 0.6% in 2025 before rising to 1.4% in 2026. Additionally, global insolvencies are projected to increase by +7% in 2025, with the US expected to see a particularly sharp rise of +16%. To read Allianz Trade's news release, with a link to the report, go to https://www.allianz-trade.com/en_global/news-insights/economic-insights/Riders-storm-managing-uncertainty-updated-economic-outlook-2025-26.html.

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President Trump's tariffs have fundamentally changed the context for NIESR's Spring Global Economic Outlook. The National Institute of Economic and Social Research (NIESR) had expected that 2025 would show similar growth to that seen in 2023 and 2024 (3.2%), but is now warning that President Trump's tariffs have fundamentally changed the context for its latest Global Economic Outlook. As a result, NIESR currently predicts that global GDP growth is likely to be around 2.9% this year, one of the lowest growth rates since the turn of the century, excepting the Global Financial Crisis in 2009 and the Covid-19 year of 2020. Outside the US, China and other East Asian manufacturing exporters, Canada and Mexico will likely be the worst hit. NIESR also suggests that global growth in 2026 will be slower than the previous forecast, at 2.8%, estimates that GDP growth in the US will slow markedly, and predicts that the previously anticipated pick-up in the Euro Area will be delayed.​ To read NIESR's news release, go to https://niesr.ac.uk/publications/tariffs-impacting-global-growth?type=global-economic-outlook.

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Global growth is expected to decline and downside risks to intensify. The IMF has warned that forecasts for global growth have been revised markedly down compared with its January 2025 World Economic Outlook (WEO) Update, reflecting effective tariff rates at levels not seen in a century and a highly unpredictable environment. The IMF's reference forecast, which incorporates information as of 4 April, projects that global growth will drop to 2.8% in 2025 and 3% in 2026, down from 3.3% for both years in the January 2025 WEO Update. This equates to a cumulative downgrade of 0.8 percentage points. Growth in advanced economies is projected to be 1.4% in 2025. Growth in the US is expected to slow to 1.8%, a pace that is 0.9% lower relative to the projection in the January 2025 WEO Update, while growth in the euro area at 0.8% is expected to slow by 0.2%. In emerging markets and developing economies, growth is expected to slow to 3.7% in 2025 and 3.9% in 2026. To read the IMF's news release, with a link to the report, go to https://www.imf.org/en/Publications/WEO/Issues/2025/04/22/world-economic-outlook-april-2025?cid=bl-com-SM2025-WEOEA2025001.

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Q1 GDP rose by 0.4% in the euro area and by 0.3% in the EU. According to a preliminary flash estimate published by Eurostat, seasonally adjusted GDP in the first quarter of 2025 increased by 0.4% in the euro area and by 0.3% in the EU compared with the previous quarter. In the fourth quarter of 2024, GDP had increased by 0.2% in the euro area and 0.4% in the EU. Compared with the same quarter of the previous year, seasonally adjusted GDP increased by 1.2% in the euro area and 1.4% in the EU in the first quarter of 2025, after +1.2% in the euro area and +1.4% in the EU also in the previous quarter. Among the Member States for which data are available for Q1 2025, Ireland (+3.2%) recorded the highest increase compared to the previous quarter, followed by Spain and Lithuania (both +0.6%). Hungary (-0.2%) was the only Member State that recorded a decrease compared to the previous quarter. The year-on-year growth rate was positive for eleven countries and negative for three. To read Eurostat's news release, go to https://ec.europa.eu/eurostat/web/products-euro-indicators/w/2-30042025-ap.​​​​

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Events & Professional Development

​Global 2025: Export, Agency & Project Finance,10–12 June. Copenhagen, Denmark

BOOK HERE BY 25 APRIL & SAVE £600

Exile Group brings together our three key brands TXF (export finance), Proximo (project finance) and Uxolo (development finance) for an unbeatable opportunity to network, collaborate and originate deals. One ticket gives you access to all three industries. In 2024, 86% of attendees confirmed they will do more business as a result of attending the conference, making the event a true catalyst for the markets we cover.​

Why attend:

• Connect with the powerhouses of the industry: Step into this premier international gathering where over 1500 dealmakers from ECAs, DFIs, exporters, borrowers, developers, project sponsors, SOEs, government ministries, commercial banks, private insurers, law firms and institutional investors converge at the go-to event of the year!

• Unlock your origination potential: With just one trip, you'll be able to collaborate and originate deals with a wide range of stakeholders, and hold multiple meetings in one place for a jam-packed two days that will give you a fantastic return on your investment.

• Diversify your pipeline: With a global presence (over 63 countries in 2024), attendees will have the opportunity to learn from diverse perspectives, discover international best practices, and foster cross-border collaboration to enrich their own strategies and grow their business. All this, across export, project and development finance.​

View the full speakers list and agenda here

For sponsorship, speaking or group booking enquiries, contact marketing@exilegroup.com.

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About this month's Sponsor: SCHUMANN

At SCHUMANN we optimise the management of risk for credit, surety, political risk insurers and export credit agencies. Our software solutions and risk models are setting the future technological standards for the industry.

We are an open minded and learning organisation which invests heavily in research and development, often with our partners at the University of Goettingen. We aim to stay ahead of the competition with our cutting edge technology.

We value our independence, and are happy to work with any data provider or partner of your choice. We favour long term partnerships. We invest all of our resources into our customer relationships, and as a result have never lost a customer in our 25 year history.

CAM Credit and Surety enables our customers to automate risk assessment and underwriting processes, while our artificial intelligence handles complex workflows with ease, enabling customers to remain compliant with their regulatory environment. 

A SCHUMANN software solution is both future proof and the most robust on the market – it will provide decades of service and will never let you down.

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Managing Directors: Evgeny Kulyushin, Dr. Adam Melski, Dr. Martina Städtler-Schumann (CEO), Jan-Torben Schwager.

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