Confindustria-Cerved: risk of bankruptcy for 40% of restaurants and a third of hotels

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May 28, 2021 40% of

restaurants

are "highly likely to fail" compared to 17.3% before Covid. This is what emerges from the

2021 SME Regional Report

, produced by Confindustria and Cerved, in collaboration with Intesa Sanpaolo. The SMEs with a concrete risk of default in the next 12 months are more than

two thirds of the companies that organize trade fairs and conferences

, with percentages anywhere above 65%. A

third of hotels are

at risk

, with clear gaps between the North-East (20.7%) and other areas, with maximum values ​​of 46.6% in the South ".

Covid and unprecedented economic crisis

Covid-19 has caused an unprecedented crisis for the Italian economy, not only in terms of size, but also due to its particularly asymmetrical nature. The health emergency had, in fact, highly diversified consequences, particularly affecting the sectors most affected by lockdowns and exposed to containment measures such as, for example, catering, tourism, hotels, transport, wholesale and non-food retail and the fashion system. While it has had a less significant impact on other sectors or even positively stimulating some, such as the pharmaceutical supply chain, online commerce and the agri-food industry.

The Cerved Report analyzes the economic and financial performance of

approximately 160,000 Italian joint-stock companies

which - employing between 10 and 249 employees and with a turnover of between 2 and 50 million euros - fall within the European definition of SMEs. With over 94,000 companies (54,000 in the North-West and 40,000 in the North-East), the

North is the area with the largest number of SMEs

, which still have a widespread presence throughout the country with 33,000 companies in the Center and 32,000 in the South.

Overall, the added value produced is equal to

230 billion euros

: 39% by SMEs based in the North-West, 28% by companies in the North-East, 18% by companies in central Italy and remaining 15% from the southern ones. 

Decrease in turnover

According to estimates, a very large number of SMEs (28 thousand, equal to 17.9%) suffered

a drop in revenues of more than 20%

in 2020

(17.7% considering the distribution of turnover). A third of the companies analyzed (53 thousand) recorded a lower but still significant decrease in revenues (between -10% and -20%). About 63 thousand SMEs have contracted sales with single-digit rates and only for the remaining 14 thousand companies (9.0%) turnover is estimated to grow or at 2019 levels.

The Center is the geographic area with the largest share of companies operating in the sectors most affected by Covid, followed by the South, which however also records the highest percentages of stable or growing companies (14.8% in terms of turnover) or with a limited decrease (37.6%). In any case, also the North-East and North-West have very high incidences in the sectors hit by the pandemic crisis, with a decrease in sales of less than 20%. On average, SME turnover is expected to decline by 10.6% between 2019 and 2020.

Due to a production specialization characterized by greater exposure to the Covid shock, the effects of the pandemic are more severe among SMEs in Central Italy, with a decline in revenues of 11.6%. There were also drops above the national average in the North-East (-10.7%) and slightly lower in the North-West (-10.5%), while in the South there was a more contained decline (-9.4%) . 

Government emergency measures have mitigated the Covid effect on SMEs

Despite substantial impacts, the SME system seems to have held up substantially so far, partly thanks to the long process of capital and financial strengthening observed throughout the Peninsula in the previous decade, but above all due to the massive use of emergency measures adopted by the Government, which mitigated the shock of the pandemic on SMEs.

Missed payments

The data on the payment habits of Italian companies indicate that during the lockdown phase, the non-payments of SMEs exploded throughout the Peninsula, but then, with the resumption of economic activity and with the progressive operation of the Liquidity Decree, they returned basically to normal.

In the most acute phase, in May, southern SMEs did not pay 55% of the value of expiring or already overdue invoices, a figure in strong growth compared to 42% in December 2019. Also in the rest of the country, the indicator is it has soared, going from 38% to 51% in the Center, from 31% to 41% in the North-West and from 27% to 36% in the North-East.

At the end of the year, the volume of non-payments returned to levels similar to those of the previous year.

Restaurants, hotels, organization of fairs and conferences: the sectors most affected 

If on an overall level the SME system, although more exposed to risk situations, seems to have held up,

in the sectors most affected by the pandemic

the effects are much more intense. In particular, the presence of SMEs with a real risk of default in the next twelve months exceeds two thirds among companies that organize trade fairs and conferences, with percentages anywhere above 65%, while 40% of restaurants are highly likely to fail. (17.3% before Covid) but, in this case, with wide gaps between those of the North-East and those of the South (50.9%). One third of the hotels are at risk, also in this case with clear gaps between the North-East (20.7%) and the other areas, with maximum values ​​of 46.6% in the South.

1.3 million fewer jobs

In the coming months, the consequences of the pandemic on employment and investment will be at the center of attention, especially to assess the possible measures to be taken to offset its negative effects and promote recovery. To this end, some estimates have been made with reference to the evolution of the health emergency, the effectiveness of the actions to combat the pandemic and the implementation of the vaccination plan. The impact on employment is very close to that estimated by Istat, with a loss of jobs for all Italian companies (not only SMEs, but also micro and large companies), between December 2019 and the end of 2021,

approximately 1.3 million units

, equal to 8.2% of the total of 16 million employees in companies before the emergency, most of whom were employed in the service sector.

At the territorial level, the estimates show higher absolute losses in the North-West (399 thousand employees, -7.8%), compared to the North-East (322 thousand, -8.2%), while in relative terms, the effects they would be higher in the South (320 thousand, -8.4%) and in Central Italy (289 thousand, -8.9%).  

Investments

The probable exit from the market of a significant number of companies and the downsizing of the turnover of many others will inevitably have repercussions also on the level of investments. According to estimates, in fact, Italian companies could lose

43 billion euros of capital

due to Covid

in the two-year period 2020-2021 (-4.8% compared to approximately 900 billion overall at the end of 2019).