The phenomenon of "zombie" companies staggering on with the help of low interest rates but unable to pay off debts rocked the insolvency practitioner Begbies Traynor today.
The firm saw pre-tax profits slide 41 per cent to £2m in the six months to 31 October.
The insolvency trade body R3 estimates that 160,000 firms are currently on life support from record low rates and forbearance from banks reluctant to write off loan losses, with around a third vulnerable to interest rate rises.
Although the company's executive chairman, Ric Traynor, expects a pick-up in business over the winter, he warned that "challenging market conditions have persisted".
Revenues also dropped to £26.1m from £29.4m last year, and the firm has been forced to cut the number of its insolvency practitioners, down to 449 at the end of October from 466 at the start of the financial year.