More than half of the private, voluntary and independent nurseries questioned also said they had considered selling up in the past year (55 per cent).
The survey by the Federation of Small Businesses (FSB), which represents around 1,150 day nurseries, received 280 responses.
Among these, 87 per cent of nursery owners said that the funding for the early years entitlement did not cover their hourly rate and 61 per cent said that extending the entitlement to 15 hours a week would have a negative impact on their business.
Dawn Nasser closed Indigo House Montessori pre-school in Croydon, Surrey, on 3 April, after running the business for seven years, because she figured that Croydon council's new terms and conditions for flexible provision would mean a loss of £10,000 in the next year.
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