Manufacturing CFOs in U.S. remain resilient despite economy, survey says

Wednesday December 17, 2008
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NEW YORK, N.Y. - Even in this economic downturn, half of manufacturing company CFOs recently surveyed expect their company's revenues to increase in the coming year, and nearly four in 10 (37 percent) predict increased profit margins, according to an annual survey of U.S. manufacturing company CFOs commissioned by Bank of America Business Capital. What's more, fifty-two percent of the CFOs say that the current state of the economy will have no impact on their growth plans.
Conducted by Granite Research Consulting from mid-August through mid-October 2008, the Bank of America Business Capital 2009 CFO Outlook surveys CFOs from 600 U.S. mid-size and large manufacturers with revenues ranging from $25 million to $2 billion.
Manufacturing CFOs surveyed are evenly split on the question of whether the U.S. economy will expand in 2009, with 31 percent believing it will, and 32 percent that see the economy contracting. This compares with 44 percent from last year's survey who expected the economy to expand, and 20 percent who saw it contracting.
In their own sectors, 25 percent of manufacturing CFOs forecast expansion in 2009, down from 30 percent last year. The remaining CFOs are almost evenly split between no change (38 percent) and contraction (36 percent).
"Overall, these results reflect the severity of the current economic downturn and the uncertainty about how long it will take to work our way out of it," said Mickey Levy, chief economist for Bank of America. "But, CFOs are taking necessary steps such as trimming inventories and operating costs in order to remain competitive, as they try to weather the storm."
Nearly seven in ten CFOs expect to raise the price of their products in 2009. This is a significant increase from the 56 percent predicting price increases last year. Forty percent of CFOs expect to spend less or refrain from making capital expenditures altogether in 2009 compared to 27 percent last year.
For complete survey results, visit www.bankofamerica.com/businesscapital24.

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