Bad times are not so good for Begbies Traynor either

As an insolvency specialist, Begbies Traynor was expected to be one of the winners from the economic downturn. Instead the company got it badly wrong, something chairman Ric Traynor was candid about today.

"We anticipated a lot more activity in the marketplace and it just hasn't come," he said. "We geared up for more activity. It has not happened."

Begbies issued two profit warnings in close succession earlier this year, partly blaming low demand for its tax-planning services.

Today it added that low interest rates are keeping companies afloat, thereby denying Begbies business.

A statement to the stock market noted: "Despite the lack of economic recovery, base rates of 0.5% since May 2009 continue to provide a very benign financing environment for otherwise weak companies."

Traynor, a 30% shareholder, added: "If you look at the recession of the early 90s when interest rates were 10% and more, companies were falling over."

Begbies floated on AIM in 2004. The stock has performed poorly. Today it added 2p to 25p, leaving it valued at £22.4 million.

City analysts still say they expect insolvencies to rise as companies which have been clinging on are finally forced to shut up shop. Those reliant on consumer expenditure are likely to particularly struggle.

Begbies had its annual meeting today in Manchester.