CFOs set to rein in costs but still see growth opportunities

Domestic concerns top CFOs’ risk list, with Brexit concerns mounting

CFOs see increasing risks to their business from Brexit and a slowing UK economy and are reacting with a renewed focus on cost control, according to Deloitte’s latest CFO Survey. However, domestic concerns have not blunted CFOs’ search for growth and opportunities.    

112 CFOs of FTSE 350 and other large private companies participated in the Q4 2017 CFO Survey. The combined market capitalisation of the 83 UK-listed companies who participated is £512bn, approximately 19 per cent of the UK quoted equity market. 

 The survey ran between 3^rd and 15^thDecember 2017.

Uncertainty rises, domestic concerns dominate

Brexit remains the top concern CFOs say their business faces, giving it (on a scale of 0-100) a ranking of 62, up from 58 last quarter. Brexit is followed by weak demand in the UK (59, up from 53) and weak UK productivity (49, up from 43).  

38 per cent of CFOs say there is a high or very high level of uncertainty facing their business, up from 35 per cent last quarter but down from 50 per cent one year ago and well below levels seen during the euro crisis and in the wake of the EU referendum.

Brexit concerns increase

73 per cent of CFOs say they expect the overall business environment to be worse following Brexit, up from 60 per cent in Q3 and the highest reading yet, but in line with levels seen in Q2 2017. 

41 per cent say they expect hiring within their business to slow as a result of Brexit, up from 36 per cent in Q3, while 39 per cent expect their capital spending to decrease, up from 30 per cent last quarter.