July’s company insolvencies were comprised of 76 CVLs, 33 compulsory liquidations and eight administrations.

The total insolvency rate in Scotland in the 12 months to July 2024 was 53.8 per 10,000 companies on the effective register. This was down by 1.0 from the preceding 12 months ending July 2023.

Michelle Elliot, restructuring advisory partner at FRP in Glasgow, said: “This data reflects the cumulative effects of years of extremely challenging economic conditions working their way through supply chains.

“The economic landscape is improving, and businesses optimism is likely to have been buoyed by the Bank of England’s rate cut earlier this month. Against this backdrop, we’re expecting to see an increase in investor activity, which could bring opportunities for firms to restructure their balance sheets with the help of new partners.

“Despite the optimism, there are still challenges ahead. This is still a difficult trading environment, and management teams will need to remain vigilant for signs of distress, and maintain their focus on building resilience.”

Jo Streeten, managing director at AECOM (Building + Places), said: “An increase in insolvencies year-on-year comes as little surprise, with construction output continuing to fluctuate in recent months. And, with inflation rising in July – for the first time this year – the jury is still out on whether we’ll see a further rate cut in September.

“But there’s reason to be confident that the sector will be lifted by busier work pipelines and infrastructure investment from the new Labour government. The challenge for contractors now will be to manage costs effectively in readiness for an increase in demand while we still face uncertain market conditions.”