Monday, May 19 11:03:54
Seven out of ten Chief Financial Officers of large Irish companies have indicated that their company has now returned to growth, according to the Deloitte Q1 2014 CFO Survey.
Following a survey high in net optimism in Q4 2013, CFO sentiment in this regard remains broadly unchanged in the first quarter of the year – 50pc of respondents are optimistic about the financial prospects of their company, down just marginally from 52pc in Q4 2013.
Interestingly, one in four respondents (26pc) indicated no requirement for funding this quarter, with bank borrowings largely expected to remain unchanged or to decrease over the coming twelve months. 68pc of respondent CFOs have also signalled that capital expenditure within their organisation is likely to increase, and correspondingly 77pc of respondents believe that their corporate strategy is expansionary.
In terms of employment, CFO sentiment remains favourable – no respondents to the survey believe that unemployment rates will rise over the coming months. 79pc believe that the unemployment rate will continue to decrease. In terms of the availability of talent, a slight majority of CFOs (55pc) have indicated that they are not finding it difficult to employ individuals with the required skills and knowledge for available roles.
With regards to the macro economy, 69pc of CFOs believe the Irish economy has already returned to growth, or will do so before the end of the year. Confidence also remains buoyant with regards to foreign direct investment, exports and GDP - 73pc, 76pc and 73pc of CFOs respectively expect an increase in these economic metrics over the coming year.
Commenting on the survey findings, Shane Mohan, Partner, Deloitte commented: "Encouragingly, CFOs who are feeling more optimistic about the financial prospects of their company attribute this largely to external factors such as the overall economic situation and industry trends. Indeed economic growth in the EU is seen as one of the biggest drivers of company performance over the next 12 months. Previously, survey results indicated that CFOs were more confident in their own companies' performance than that of the overall economy. It is positive to see more of a balance in this regard, and 85pc of respondents believe the level of external financial and economic uncertainty facing their business is low.”
Findings indicate that CFOs predict revenue growth in their firms will be driven by new offerings in 2014. There is also an increased view amongst respondents that their businesses will grow organically rather than by acquisition.
The top three external factors which CFOs identified may impede their business over the coming year included talent costs, fuel/energy prices and industry specific regulation.