Financial troubles far from unique

ALTHOUGH TXU has had the most spectacular fall from grace, it is not the only Ipswich company to have found life tough in 2002.The insurance sector has been hit hard during the year, seeing the value of shares slide and jobs being lost.

By Paul Geater

ALTHOUGH TXU has had the most spectacular fall from grace, it is not the only Ipswich company to have found life tough in 2002.

The insurance sector has been hit hard during the year, seeing the value of shares slide and jobs being lost.

Both Axa and Royal Sun Alliance, which have substantial offices in the town, have been hit hard.

This is as a result of two main factors: the loss of confidence in the wake of September 11 and the slide in world stock markets.

September 11 is the most easily understood problem for the industry – the Twin Towers were insured in markets across the world.

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But the most serious problem facing companies dealing in life assurance has been the fall in the stock market.

This has seen the value of individuals' endowments and pensions fall over the year – and as companies have tried to maintain payments to their clients their profits have been squeezed.

Royal Sun Alliance, which has a major regional office in Museum Street, and Axa have both been hit by this fall.

However another major player in the insurance business, commercial broker Willis, has seen its share price rise spectacularly as businesses become more aware of the need to arrange insurance for more risks.

Another sector which has been hard hit over the last year is new technology companies.

Agilent, which has a major plant on the Whitehouse Industrial Estate, was forced to mothball its new building shortly after it was completed as business dried up.

And BT has faced a rocky year as its share price has slid – although not as spectacularly as some other telecoms firms.

Both companies are seen as basically sound and have been at the mercy of the markets – but both will be hoping for a global upturn in 2003.

Probably the most well-documented company facing financial problems at the moment is Ipswich Town Football Club.

That saw its income drop dramatically following relegation from the Premiership, and while its financial situation is not as serious as that faced by some other clubs, life is tough at Portman Road.

Players and other members of staff have taken wage cuts to help the club out of its plight – but salvation remains tied to promotion back to the top flight at the first attempt.

Its path to financial security is clear – goals in the back of the net and points on the league table.

Other struggling companies in Ipswich have a less clear answer to their problems – but will be hoping they find their own promotion prospects improve.

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