Daily NewsView All News
One of Austria’s largest staffing firms, MPS, has gone bust with the firm filing for insolvency, it has been revealed this week. The staffing company had made a number of investments to expand its branch network in the country, but weaker economic conditions have led to a debt overload.
MPS said it plans to keep the business going despite its financial difficulties. The insolvency is the largest in Austria this year, based on the firm’s headcount of 800 people. The recruiter applied to open insolvency proceedings at a regional court in Graz where it is headquartered.
A look at the balance sheet reveals the firm’s financial troubles as liabilities amount to €16.2 million, compared to assets of €9.4 million. This leaves the company with a debt overload – the excess of liabilities over assets – of €6.8 million.
MPS is a family-run business led by Markus, Manfred und Theresia Fröhlich. It was founded over 20 years ago with the firm branching out into international markets in 2011. Apart from Austria, the recruiter also operates in Hungary and Slovenia.
But the company came under pressure with the start of the financial crisis in 2008. After economic conditions then started to improve in 2010, it had expected to see higher revenue growth and decided to expand both its domestic and international branch network in 2011. But the economy remained weaker than anticipated and expectations were not met, the firm said. MPS added that additional costs in the Austrian staffing industry, introduced earlier this year, have also weakened revenue growth.