A RECORD number of Australian companies went bust in February as the downturn in consumer confidence took a devastating toll, new figures reveal.
And more records could tumble, with insolvency experts warning that corporate collapses are likely to remain at historic highs for the rest of the year.
National accountancy firm Taylor Woodings says a fall in consumer spending and poor business confidence are undermining company profitability, driving the insolvency spike.
Official figures reveal there were 1123 insolvencies in February - the highest monthly level since records began in 1998. Chief casualties were retail, tourism and construction businesses.
In Victoria 270 companies collapsed, which was more than double the number of insolvencies the previous month and up 16 per cent on February last year.
Taylor Woodings managing partner Michael Ryan said Victorian companies still remained among the strongest financially.
"Victoria, of all the states has weathered the (global financial crisis) and the follow-on the best," Mr Ryan told BusinessDaily last night.
"This is because going into the GFC, property prices did not increase as quickly as in other states ... where high real estate prices perhaps fuelled some poor management decisions.
"The latest insolvency figures reflect the difficulties facing many retail, tourism, building and construction and property development companies with the global financial crisis continuing to have a lag effect."
Historically, insolvencies climb in February after a quiet period at Christmas. But there was a 117 per cent jump nationally from January to February this year - well ahead of the average 47 per cent increase.
"This is an early indication that insolvencies will remain high nationally for the remainder of the calendar year because the pressures on small businesses are not easing," Mr Ryan said.
"These pressures include a high Australian dollar, low confidence, tightness in lending markets and a slowdown in the residential building and retail sectors."
The Australian Securities and Investments Commission issued the February insolvency figures this week.
They reveal NSW had the largest number of company collapses at 453, and the biggest percentage increase - up 134 per cent from the previous month. Queensland and Western Australia also recorded spikes in insolvency numbers - up 122 per cent and 114 per cent respectively in February.
Court-ordered wind-ups soared 470 per cent as the Australian Tax Office amped up claims against companies.
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