AIM counts cost of Brexit jitters and falling commodity prices

The Alternative Investment Market (AIM) has shrunk by 60 companies in the past year as it counts the cost of Brexit jitters and sliding commodity prices, a report has found.

AIM has been hit by resources firms exiting the market and bouts of volatility triggered by Britain's break from the European Union, according to a study by accountants UHY Hacker Young.

The report found that 25 firms left AIM in the past three months, with nine firms blaming financial stress or insolvency. In the last quarter alone, 10 of the 25 companies that de-listed from AIM were in the energy and mining sectors.

Laurence Sacker, managing partner at UHY Hacker Young, said: "Resources companies are continuing to rapidly exit the market and the uncertainty caused by Brexit means there isn't a steady flow of companies joining AIM.

"A difficult year for Initial Public Offerings has been intensified by the shadow of the EU referendum looming over the UK. Companies have been reluctant to list on AIM with the possibility of Brexit and many have been forced to exit the market after struggling financially."

High-profile firms listing on AIM this year include Time Out Group, which raised £90 million; Hotel Chocolat Group, which raised £12 million and Comptoir Group, the owner of Lebanese and Eastern Mediterranean restaurant chain Comptoir Libanais, which raised £16 million.

The study said there was 40 new entrants to AIM in the past 12 months, while 100 companies exited the market, compared to 70 new listings and 100 de-listings in 2014/15.

Mr Sacker added: "With Brexit's impact still uncertain, there will inevitably be a reluctance for new companies to plan to list on AIM until there is some clarity on the way forward, prolonging the market's downturn.

"AIM is seeing a large proportion of companies in the energy and mining sectors leave the market. This is prompting real concern for the health of AIM as these sectors are traditionally a strong source of new entrants."