Company insolvencies climb to 14,152 for FY2025–26

The worst hit industry was again construction, with 3,472 construction companies entering external administration or having a controller appointed. Accommodation and food services recorded the second highest number of insolvencies at 2,078.

Creditors' voluntary liquidation was the most common form of insolvency, accounting for around half of all insolvencies for the year, followed by court appointments.

While restructuring saw a surge in popularity during the 2024–25 income year, it was less common during the 2025–26 financial year, with only 3,031 companies using restructuring.

Despite the pressures from rising energy costs and interest rates in the last quarter of 2025–26, insolvency rates for the fourth quarter were actually down by around 8 per cent compared with the same period from the 2024–25 financial year.

The highest number of insolvencies was recorded in the December quarter of the 2025–26 year, when 3,856 companies entered insolvency.

The latest NAB Business Survey showed business conditions were mixed, with conditions softer but a drop in retail prices suggesting that the oil-related inflation surge is unlikely to be as persistent as it was in COVID-19.

CreditorWatch chief economist Ivan Colhoun noted that business conditions are only slightly below the long-run average and the economy is yet to slow substantially from the interest rate rises, higher fuel prices and the announced taxation changes.

While the construction industry recorded the highest number of insolvencies in the ASIC statistics, Colhoun noted that construction recorded the most favourable conditions in the latest NAB business survey in many years.

Sectors that use fuel as an input for production or where transport costs are high are recording weaker conditions, on the other hand. This includes industries such as manufacturing, retail trade and wholesale trade.