BOURNEMOUTH businesses experienced an "Indian Summer" of trade as new figures show a drop in the number of firms suffering from financial problems during July, August and September, a leading insolvency firm has said.

According to business rescue and recovery specialist Begbies Traynor’s Red Flag Alert research into corporate financial distress levels for Q3 2015, the town saw a seven per cent fall - 884 to 818 - between the second and third quarters of this year in the number of businesses suffering from ‘significant’ financial distress.

Year-on-year, there was a larger drop still, of 10 per cent from 906 to 818.

Significant financial distress is defined as firms facing CCJs of less than £5,000 and deteriorating capital and retained profits.

Begbies Traynor also said that there was cause for optimism across the wider South West region, with 10 per cent fewer businesses experiencing ‘significant’ financial distress year-on-year.

During the three months to September 2015 there was an eight per cent fall in firms suffering from problems, the firm said.

Julie Palmer, partner at Begbies Traynor’s Bournemouth office, said the figures showed that the region was beginning to benefit from the economic recovery.

She said: “During the past year there has been a solid trend emerging of falling distress levels across the broader Bournemouth economy.

"What’s notable about these latest figures is that most sectors are seeing fewer businesses in trouble.

"We’re also seeing positive signs amongst food retailers and food suppliers due to a degree of stability re-emerging amongst the supermarket sector.

"Additionally, the uncertainty earlier in the year around the outcome of general election may have delayed investment but there appears to have been little long-term effect on the economy, as the Q3 figures demonstrate.”

Looking at the sectors in Bournemouth, bars and restaurants remain a concern when taking a year-on-year perspective due to a 23 per cent increase - 44 to 54 - in the number of businesses experiencing ‘significant’ financial distress, Begbies Traynor said.

Looking at the quarterly figures, the sector saw a slight drop, from 58 to 54, seven per cent.

The company said that automotive firms, including garages and used car sales businesses, were seeing improving fortunes, with a 35 per cent decrease - 34 to 22 - in distress levels between Q3 2014 and Q3 2015 and a 33 per cent fall - 33 to 22 - during Q3 this year.

Construction also improved with 20 fewer firms in distress during July, August and September 2015 and 13 fewer year-on-year.