UK CFOs more uncertain about future than European counterparts

Optimism is growing among business leaders across Europe and the outlook for revenue growth, hiring and capital spending is improving, although in the UK uncertainty levels are markedly higher than elsewhere, according to Deloitte’s latest European CFO survey

A poll of more than 1,500 CFOs found that 43% say they are more optimistic about the prospects for their company than they were three months ago, up from 38% in Q1’s survey. Just 11% say they are less optimistic, down from 13%.

Optimism is highest in France, with 78% of CFOs more positive, and lowest in the Netherlands with 23% more optimistic. CFOs in euro area economies are notably more optimistic than in non-euro companies (46% compared to 38%).

More than two thirds (69%) of CFOs are confident that their firm will increase revenues over the next 12 months.

Some 73% of CFOs in euro area countries predict revenue growth, compared to 63% in non-euro countries. CFOs in Belgium are the most optimistic about revenues, with 95% predicting growth, while CFOs in Denmark are the least positive, with just 47% expecting growth.

Half (52%) of European CFOs now say there is a high level of financial and economic uncertainty, down from 61% in Q1. The level of overall uncertainty is its lowest since the launch of the survey in Q1 2015.

However, CFOs in the UK have the highest reading on perceptions of uncertainty, with 85%, while CFOs in Austria had the lowest.

A third (33%) of European CFOs say now is a good time to take greater risks onto their balance sheets, unchanged from Q1’s survey, while 42% forecast an increase in capital spending in the next 12 months, up from 40% in Q1.

Over half (58%) of CFOs in Ireland say they plan to increase capex, the highest, compared to just 22% in the UK.

While overall 38% of CFOs say they plan to increase employee numbers in the next 12 months, just 12% of CFOs in the UK are set to increase hiring, the lowest level.

The sixth biannual Deloitte European CFO Survey is here.

Report by Pat Sweet

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