December administrations reach three-year high

Fewer construction companies went under in December 2025 than the month before, according to the latest data from Creditsafe.

But the 20 collapses in the final month of the year marked the highest December total since 2022, when 23 firms went under.

In a broader context, the fourth quarter (Q4) tally of 63 administrations made it the quietest Q4 since 2021, when 62 firms collapsed.

Creditsafe recorded 286 construction administrations for 2025 as a whole, up slightly on the 282 failures in 2024 but well below the worst-affected year, which was 2023 with 363 administrations.

Six of the firms in the latest casualty list employed fewer than five staff and two others – Elm Farm Ltd and Abbeyglen Ltd – collapsed without ever filing annual accounts.

SDM Fabrication Ltd was one of only two firms large enough to file detailed accounts with Companies House.

The Cambridgeshire-based structural steel contractor called in Hayley Watson, Chris McKay and Richard Bloomfield of FRP Advisory.

SDM had recently experienced “sustained financial pressures linked to rising input costs, sector-wide margin challenges and tighter liquidity”, FRP said in a statement.

“Prior to [SDM] entering administration, FRP assisted the directors with running a sales process in an attempt to save the business and jobs of all employees. However, a deal could not be achieved.

“Following the administrators’ appointment, the business ceased trading and all 96 employees were regrettably made redundant.

“The administrators have now supported those affected to submit claims to the Redundancy Payments Service.

“An orderly wind-down of the company’s affairs is underway, including the sale of assets and recovery of outstanding debts.”

Family-run SDM was established in 2010 and focused on the design, fabrication and installation of structural steelwork, mainly in East Anglia and London.

It operated from a four-acre base in March, near Peterborough.

The firm’s most recent published accounts, covering the year to 31 August 2023, showed the £21m-turnover firm had doubled its pre-tax profit to £1.9m and was expanding its factory to increase steel fabrication capacity by 50 per cent.

“We have a clear path towards maximising the use of this increased capacity over the coming two to three-year period,” director Richard Melton said.

SDM held fixed assets valued at around £2.9m and current assets worth £6.3m, with net assets totalling £1.9m.

However, the firm’s accounts also described a “subdued” market outlook and said the decrease in tender opportunities was a “telltale sign of a general decline in activity”.

SDM handled work ranging from small-span portal frame buildings to composite high-rise developments and complex fabrication projects.

Clients included tier one contractor Kier, for which SDM was providing steel for the first phase of the £40.9m Hewett Academy in Norwich at the time it went under.

The firm also supplied a 190-tonne steel frame on Kier’s Wisbech Green special school, which was completed in 2023.

Waagner Biro Steel and Glass Ltd, a London-based structural steel and glass specialist, was among the other firms that fell into administration last month.

It called in Tyrone Courtman and Matthew Haw of RSM as joint administrators.

In its most recent audited accounts for the year to 31 December 2024, the company reported turnover of £35.2m and a pre-tax profit of £374,373.

It employed a monthly average of 13 staff.

The company’s assets were valued at around £14m, with net assets of £586,000.

Its project portfolio included the Great Court (pictured) at the British Museum in London and One Angel Square in Manchester.

‘Confidence chasm’

The new Creditsafe data was issued a few weeks after the S&P Global Construction PMI revealed an 11^th consecutive month of falling new orders.

Julie Palmer, managing partner at Begbies Traynor, described a “confidence chasm” that is “stifling growth” in the construction sector.

“With data showing residential, commercial and civil engineering projects all down amid the backdrop of ambitious targets and housing demand, the industry desperately needs to feel that rising costs, materials inflation, skills gaps and supply chain issues are being dismantled by policy decisions,” she added.

“Construction firms need to act now to confront distress early and create the stable foundations for survival and regrowth by reviewing and evolving strategy, direction or management.”

Palmer urged contractors to prioritise their financial resilience by “countering incoming cost increases and HMRC’s recovery of unpaid tax, with realistic profit margins and leveraging the value of assets to create more cashflow”.

Shortly before Christmas, new data from the Insolvency Service showed that construction business collapses (including liquidations) had surged from 291 in September to 360 the month after.

RSM UK restructuring advisory partner James Hawksworth said the spike was probably due to “high material prices and increasing labour costs” for contractors.

“This is creating a perfect storm for the sector, when combined with project delays placing intense pressure on working capital, and lenders being cautious about advancing funds to the sector,” he added.