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CFO Survey Risk aversion sets in Stay ahead . Q4 2014
CFO SurveyRisk aversionsets in
Stay ahead.
Q42014
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Contents
Collaborate
Connect
Influence
The Deloitte CFO Survey 5
Optimism in check 7
Modest growth in challenging times 11
Risk aversion sets in 14
Reasons to be cheerful – Australian dollar, interest rates 18
Appendix 20
Contact us 22
The Deloitte CFO Survey targets the CFOs of major Australian listed companies. It has been conducted on a quarterly basis since the third quarter of 2009. This survey covers the fourth quarter of 2014 and took place between 9 December 2014 and 12 January 2015. 52 CFOs participated, representing businesses with a combined market value of approximately $252 billion or 15% of the Australian quoted equity market.
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Contacts
Keith Skinner Chief Operating Officer Tel: +61 2 9322 7580 email: [email protected]
Stephen Gustafson Partner Tel: +61 2 9322 7325 email: [email protected]
CFOs entered 2014 full of optimism but the position is far more subdued as we move into 2015. Whilst there are modest signs of positive growth, genuine momentum and confidence are in short supply.
The year ended with a greater sense of caution for Australian CFOs. With just over a quarter of CFOs thinking now is a good time to take greater risk onto their balance sheets, they appear to be preparing for an uncertain future.
Decisions on pursuing growth strategies are focused around safe choices such as organic expansion and introducing new products or services. Interestingly, over half of the CFOs surveyed indicated their companies are more risk-averse than the rest of the market. This poses the question: are we too risk-averse to successfully compete in a growing globalised world?
On a positive note, continuing low interest rates and the falling Australian dollar are likely to help many Australian corporates. However, global uncertainties, weaker commodity prices and ongoing political policy debate continue to weigh heavily on confidence.
CFOs continue to face a challenging environment, but that’s nothing new. The big question is what will shift the needle? The Australian dollar, growth in China, domestic politics or something else?
One gets the feeling that the uncertainties of the second half of 2014 may continue well into 2015. Let’s hope not.
Keith Skinner Chief Operating Officer
For additional copies of this report please contact Fahreeal Alam on +61 2 9322 3351 or email [email protected]
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Continued uncertainty is impacting CFOs attitude towards taking greater risk. 73% are unwilling to take on risk. Economic and government policy uncertainty being top inhibitors.
More CFOs expect to reduce gearing in the year ahead.
More than three quarters of CFOs expect modest growth during this challenging time, largely through organic growth.
Low interest rates and a falling Australian dollar provide reason for hope for CFOs. Over half of CFOs surveyed expect the dollar to drop below US$0.80 in 2015.
Uncertainty around Federal government policies, weak commodity prices and slowdown in China weighs heavily on CFO optimism.
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The Deloitte CFO Survey Risk aversion sets in
Key points from the CFO Survey
• CFO optimism in Australia remains low for the third consecutive quarter at net 6%, lower than that of CFOs in the UK and North America
• The Chinese economy, commodity prices and Federal Government policy uncertainty continue to be the most negative factors weighing on CFO optimism levels
• The falling Australian dollar is having a positive effect on CFO optimism, with 50% expecting it to be below US$0.80 in the next 12 months
• Risk aversion has continued to increase over the past three quarters, with 73% of CFOs indicating now is not a good time to take on more risk
• More than half of the CFOs surveyed see their own companies as more risk-averse than others in their industry, while less than 20% see themselves as being more risk-taking than their peers
• Credit conditions are great – money is cheaper and more available than at any point in recent years – but not having a major impact on growth ambitions
• A growing number of CFOs intend to reduce gearing in the year ahead.
Optimism in checkFor the sixth successive quarter, CFOs indicated they were more positive about the financial prospects for their companies then they were three months ago… but only just. A net 6% of CFOs in Q4 were more optimistic compared to a net 2% in Q3 and a net 6% in Q2 2014. While sentiment remains positive, it is clear this is finely balanced and is certainly a long way from the levels caused by genuine business momentum reported 12 months ago.
A major restraint on optimism levels has been uncertainty over Federal Government policy. This was a negative factor for a net 62% of CFOs, returning to the levels last seen in Q2 2013 in the run up to the last Federal election. While the change of government at the time reversed the trend for Q3 2013 (creating a positive factor for optimism), we have been in a downhill slide since, reflecting ongoing Budget reform battles and the current impasse in the Senate.
The Chinese economy continues to negatively affect net 46% of CFOs, the worst result recorded since 2013.
The optimism of Australian CFOs is also restrained relative to their peers in both the UK and North America. American CFOs have continued a remarkable run of business confidence with a net 33% feeling more optimistic than three months ago – the seventh straight quarter of positive results.
Risk aversion sets inOnly 27% of CFOs indicated now is a good time to take on more financial risk. This is the third straight quarter this measure has declined since its recorded highs at the beginning of 2014. Furthermore, 85% of CFOs believe this uncertainty will last for at least a year or more.
While only 19% of CFOs see themselves as taking on more risk than their industry peers, 56% see themselves as more risk-averse. This distortion indicates that risk aversion has become more pervasive in the minds of Australian CFOs.
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In articulating their risk appetite, 79% of companies have documented risk appetite statements that cover all risk categories either at the corporate level or fully cascaded down the organisation. This number may have grown in recent times with the increasing focus on risk management. Whilst documented positions are good, it is important that they do not create inflexibility should economic conditions change rapidly and new opportunities emerge.
Modest growth in challenging timesDespite the relatively flat levels of optimism, CFOs remain confident in their ability to drive increased revenue growth (75%) and operating cash flows (62%) in the year ahead.
More CFOs expect to increase headcount and capital expenditure in the next 12 months than those planning reductions. However, discretionary spending levels remain under pressure as CFOs continue to actively manage financial performance.
Credit is cheaper and more available than ever before, creating a positive environment to support growth aspirations. However, a more concerning trend is the increase in the number of CFOs who expect to reduce gearing, a growing trend in the past three quarters.
Reasons to be cheerful… Australian dollar, interest ratesThe most positive movement in CFO opinion was driven by the falling Australian dollar and continuing low interest rates. CFOs see both as major drivers of optimism, together with the strength of the US economy.
CFOs see further falls in both metrics in the year ahead, with 50% expecting the dollar to fall below US$0.80 and 42% expect it to fall to 2.25% or lower in the next year, an increase over last quarter’s 15%.
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Optimism in check
CFO optimism continued its subdued trend of recent quarters with only a net 6% more optimistic about their financial prospects than they were three months ago. Whilst still positive, it is clear that economic uncertainties continue to restrain CFO optimism. This trend is in stark contrast to the positive momentum evident in late 2013, early 2014.
Just over half of the respondents (52%) were broadly unchanged, while 21% of CFOs were less optimistic.
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Chart 1Business confidence – localCompared to three months ago how do you feel about the financial prospects for your company?
Chart 2Business confidence – international Compared to three months ago how do you feel about the financial prospects for your company?
A continuing divergence is evident between Australian and North American CFOs, with Australian CFOs considerably less optimistic that their North American counterparts. North American CFO optimism has remained positive since Q4 2012 – a remarkable eight straight quarters.
CFO optimism in the UK fell to net 8%, its lowest level in two years, showing similar levels of circumspection to Australia.
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Net % – Australia Net % – UK Net % – North America
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Chart 3Impacts on levels of optimism – global factorsHow has your level of optimism been impacted by the following factors?
Australian CFOs continue to feel positive about the global influence of a strong US economy, with 63% of respondents saying the US economy has increased their optimism.
The Chinese economy continues to weigh on CFO confidence however, impacting negatively on a net 46% of CFOs, its lowest level since Q2 2013. The impact of slowing Chinese growth rates has deeply affected Australian CFOs in the back half of 2014.
At the same time, ongoing European troubles have also contributed negatively to CFO optimism, albeit to a lesser extent than China.
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US economy European economy Chinese economy
Deloitte perspective
One key point to consider is that developments in the North American and European economies have much less impact on Australian businesses in the immediate term than
the outlook for the Chinese economy. This explains why CFO concerns over weakness in the Chinese economy outweigh obvious improvements in the US economy. When taken together with the Government’s protracted struggle to pass its Budget through the Parliament, it is unsurprising that CFOs are still cautious. What’s more, they seem to expect little improvement in the factors driving their uncertainty during 2015.
Ian Harper, Partner, Deloitte Access Economics
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The biggest driver of CFO pessimism has been the impact of Federal Government policy uncertainty. This impact is now at similar levels to the Q2 2013 survey where pre-election confidence in Government policy hit rock bottom. This trend was initially reversed post-election, but 2014 has seen a continual decline since that time.
Just over six months ago in our Q2 report, the majority of CFOs (54%) agreed that the rate of fiscal repair undertaken by the Australian Government’s 2014 Federal Budget was reasonable. However, as the Budget struggled to get approval through the Senate, we saw a direct correlation with CFO confidence continuing to drop and attributing their lack of optimism to the uncertainty around federal government policies.
Weak commodity prices and the multi-speed economy also continue to add to CFO uncertainties.
On a positive note, the weakening Australian dollar and continuing low interest rates have had a positive impact on the optimism of net 48% and net 38% of CFOs respectively.
Chart 4Impacts on levels of optimism – local factorsHow has your level of optimism been impacted by the following factors?
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Value of Australian dollar Interest rates Federal government policy
Multi-speed Australian economy Commodity prices The Australian share market
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Chart 6Timeframe for uncertaintyHow long do you expect the current levels of uncertainty to last?
Similar to last quarter, the majority (85%) of CFOs expect the current rates of uncertainty to prevail beyond the 2015 calendar year. Only 15% believe uncertainty will last less than one year, a slight increase from last quarter’s 7%.
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CFOs still have high levels of financial and economic uncertainty – and, with 63% indicating it is above normal to very high, the highest level since Q3 2013.
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Chart 5Financial and economic uncertaintyHow would you rate the general level of external financial and economic uncertainty facing your company?
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Modest growth in challenging times
Despite relative flat business sentiment, CFOs remain confident in their ability to drive revenue growth and operating cash flows. For example, 75% of CFOs expect increases in revenues in the year ahead and 62% expect operating cash flow to increase.
Further positive signs include the number of CFOs expecting to increase headcount and capital expenditure in the next 12 months outweighs those who expect to reduce it. However, significant downward pressure over discretionary spending reflects the continuing rigor CFOs are adopting to drive financial performance.
Chart 7Australian business metricsHow are the following key metrics likely to change for your company over the next 12 months?
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With the continuing availability of low cost debt, equity funding remains the least favoured source of funding. Bank borrowing is the most favoured source of funding at net 88%, followed by internal funding and corporate debt.
Chart 9Favoured sources of corporate fundingHow do you currently rate the following sources of funding for Australian corporates?
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-20%
Organic expansion is the preferred growth strategy for CFOs over the next 12 months, with nearly 80% of CFOs expecting it to increase. Also, 66% of respondents indicated their companies would increase their introduction of new products and services, and expansion into new markets. The subtle increase from last quarter implies modest growth expectations in a challenging environment with low appetite for risk.
M&A activity has remained stable for three quarters in a row, with almost half of the CFOs expecting some increase in activity. There were no major movements in expectations for leverage, asset disposal, raising new capital and renegotiating financing facilities over the last three months.
Chart 8Business strategiesWhich of the following business strategies is your company likely to pursue over the next 12 months?
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Chart 10Cost and availability of creditHow would you rate the overall cost and availability of new credit for Australian corporates?
Chart 11Level of gearing on Australian corporate balance sheetsWhat do you think of the level of gearing on Australian corporate balance sheets and what is the aim for your company’s level of gearing over the next 12 months?
Credit continues to be cheap and available, offering positive conditions to support the growth ambitions of CFOs.
It is interesting to note that whilst these favourable credit conditions have remained in place through 2014, CFO optimism has been subdued by a number of other local and global factors. This raises the question of the effectiveness of monetary policy as a driver of economic activity in the face of substantial business uncertainties.
CFO intentions to lift gearing are at their lowest in three years. Despite credit being cheaper than ever before, most CFOs do not intend to raise gearing.
This is despite the fact that the general opinion is that Corporate Australia is under geared, with a net 27% of CFOs reflecting this view.
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Risk aversion sets in
Chart 12Attitudes towards riskIs this a good time to be taking greater risk onto your balance sheet?
Some 73% of CFOs believe now is not a good time to take greater risk onto their balance sheets, with the flat optimism trend translating into higher levels of risk aversion. Only a year ago, CFOs were willing to take on far greater risk. However the last three quarters have seen increased uncertainty, with a commensurate shift in risk appetite.
Rising uncertainty has also led to an easing in CFO corporate risk appetite in the UK, which fell from a record high of 71% in Q3 to 56% in the latest survey.
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Yes No
Last quarter, we saw CFOs remain focused on growth despite weakened commodity prices and ongoing frustration with the political impasse in Canberra. These concerns resulted in a reduced appetite for risk, which was at its lowest level since June 2013.
This quarter we explored whether there has been any change in risk appetite, what is really influencing these numbers and whether this is affecting CFO business confidence and investment plans.
Deloitte perspective
With formal documented risk statements comes the
danger that a certain risk appetite gets locked in at a certain point in time. Regular revisions of the documented risk statements should be undertaken so organisations don’t find themselves at a disadvantage when circumstances become more favourable for taking risk. Otherwise, they may find themselves locked into risk averse decisions taken during a conservative climate, such as now.
Harvey Christophers, Partner, Risk Services
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Chart 13Defining risk appetiteHow formally is risk appetite defined in your organisation?
Chart 14Position on the risk spectrumWith regard to your experience of the broader market and other companies in your industry, how does your organisation’s appetite for risk fall within the risk spectrum?
Corporate Australia has become more risk-averse – both individual companies and more broadly across the market. More than half (56%) of the CFOs surveyed stated their organisations were somewhat to significantly risk-averse, despite credit being cheap and readily available. Once again this reinforces the theme of generally flat levels of business optimism and aversion to risk relative to the market. Only 2% of respondents said their organisation was open to taking significant risks.
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More than half of the respondents stated that all significant risk categories were documented and cascaded throughout the organisation. A further 23% had done so at a corporate level. This is a big step forward for corporate governance and the alignment of risk appetite across the board, executive management and the organisation.
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Deloitte perspective
Only 19% of CFOs feel like their organisation is prepared to take more risk than other companies in their industry. This is an interesting psychological factor impacting
Australian CFOs where they view their industry as a whole as being prepared to take more risk, even though normal distribution curves would say that it cannot be the case. Could this be having an impact on their choice of factors positively impacting risk appetite to be more skewed towards safer choices such as existing businesses with greater opportunities as opposed to new markets or new channels to market?
Harvey Christophers, Partner, Risk Services
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By far the most dominant factor impacting risk appetite positively is growing opportunities in the existing business. Recognising organic expansion as a key growth platform in this way, whilst positive, could also be indicative of inherent conservatism amongst CFOs in the current uncertain times.
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Chart 15Top factors having a positive impact on risk appetiteWhat are the top two factors that have a positive impact on your risk appetite (i.e. you are prepared to take more risks to drive opportunity)?
Economic (56%) and government policy uncertainty (38%) were the top two factors decreasing CFOs’ risk appetite, closely followed by regulation (37%) and increasing business model disruption (23%), which emerged as a significant theme. This reinforces that CFO’s appetite for risk is directly impacted by global and local factors such as the slowdown of the Chinese economy and uncertainty around the federal government’s policies.
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Government policy uncertainty 38%
Chart 16Top factors having a negative impact on risk appetiteWhat are the top two factors that have a negative impact on your risk appetite?
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Over half of the CFOs surveyed said that management and Board member views were aligned on risk and a further 27% indicated only a slight misalignment. Only 21% of respondents believed their management’s view differed moderately from that of their Board.
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Chart 17Management’s vs. Board’s view on riskHow does management’s view of risk differ from your Board’s view?
Executive leadership is primarily responsible for determining company risk appetite for 63% of the CFOs surveyed. None of the survey respondents identified the Chief Risk Officer as having the primary responsibility for determining risk appetite.
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Chart 18Primary responsibility for determining risk appetiteWho is primarily responsible for determining the risk appetite for your organisation?
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Chart 19Value of the Australian dollarWhere do you see the value of Australian dollar in 12 months’ time?
Reasons to be cheerful – Australian dollar, interest rates
In the Q3 survey, only 2% of CFOs expected the value of the Australian dollar to fall below US$0.80 within 12 months, while close to a third expected to see it climb back to more than US$0.90. CFO expectations have shifted dramatically in Q4, with 50% predicting the dollar to drop below US$0.80, and only 2% expecting an increase to more than US$0.90.
Even though Australian CFOs’ overall optimism remained subdued, a key optimism driver – a lower Australian dollar – is now in play.
Deloitte perspective
The future is not all doom and gloom. There are still reasons to feel positive with employment rates picking up while the falling Australian dollar has improved our
trade outlook. As the economy is quite sensitive to a lower exchange rate and inflation is not about to take off, monetary stimulus in the form of rate cuts may be welcome but isn’t necessary to boost confidence. Each budget cut that is abandoned adds to fiscal stimulus, further reducing the need for lower interest rates.
Ian Harper, Partner, Deloitte Access Economics
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Chart 20RBA’s official cash interest rateWhere do you see the RBA’s official cash interest rate in 12 months’ time?
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39% 37%
CFOs’ views on interest rates have also shifted significantly downwards this quarter. While 33% of survey respondents believe the RBA’s official cash rate will remain at 2.50%, 42% expect it to fall to 2.25% or lower in the next year, an increase over last quarter’s 15%.
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Appendix
A note on methodologyMany of the charts in the Deloitte CFO Survey show the results in the form of a net balance. For example, this net balance could represent the percentage of respondents reporting that bank credit is attractive, less the percentage saying bank credit is unattractive. This is a standard way of presenting survey data. To aid interpretation of the results, this table contains a full breakdown of responses to some of the questions covered in this report which have historical significance. Due to rounding, responses to the questions covered in this report may not sum to 100.
Q4 2014
Q3 2014
Q2 2014
Q1 2014
Q4 2013
Q3 2013
Q2 2013
Q1 2013
Q4 2012
Q3 2012
Q2 2012
Q1 2012
Q4 2011
Q3 2011
Q2 2011
Q1 2011
Q4 2010
Chart 1: Compared to three months ago how do you feel about the financial prospects for your company?
Significantly more optimistic 4% 4% 4% 2% 0% 2% 0% 3% 7% 6% 0% 5% 4% 6% 3% 9% 6%
Somewhat more optimistic 23% 24% 26% 41% 38% 47% 19% 32% 26% 17% 16% 33% 22% 17% 20% 45% 42%
Broadly unchanged 52% 46% 46% 50% 48% 43% 52% 53% 42% 55% 63% 50% 42% 45% 58% 33% 48%
Somewhat less optimistic 19% 24% 24% 7% 13% 8% 26% 11% 22% 21% 21% 13% 29% 29% 19% 12% 2%
Significantly less optimistic 2% 2% 0% 0% 2% 0% 4% 0% 3% 1% 0% 0% 3% 4% 0% 1% 2%
Chart 5: How would you rate the general level of external financial and economic uncertainty facing your business?
Very high level of uncertainty 4% 0% 0% 0% 3% 2% 4% 3% 7% 0% 6% 1% 7% 6% 6% – –
High level of uncertainty 15% 11% 12% 5% 13% 11% 22% 10% 18% 23% 28% 25% 34% 27% 13% – –
Above normal level of uncertainty 44% 62% 44% 45% 42% 58% 57% 45% 51% 54% 53% 43% 38% 44% 49% – –
Normal level of uncertainty 37% 28% 40% 50% 42% 28% 17% 42% 25% 24% 13% 26% 19% 20% 33% – –
Below normal level of uncertainty 0% 9% 4% 0% 0% 0% 0% 0% 0% 0% 1% 5% 1% 2% 0% – –
Chart 9: How do you currently rate bank borrowing as a source of funding for Australian corporates?
Very attractive 35% 26% 20% 16% 19% 32% 20% 15% 8% 6% 4% 5% 4% 0% 8% 6% 8%
Somewhat attractive 54% 48% 52% 52% 52% 49% 59% 52% 49% 44% 46% 39% 36% 51% 49% 34% 34%
Neutral 12% 20% 20% 29% 25% 15% 19% 27% 26% 35% 35% 35% 38% 31% 36% 47% 44%
Somewhat unattractive 0% 7% 8% 4% 5% 0% 2% 5% 12% 11% 13% 20% 22% 15% 8% 12% 15%
Very unattractive 0% 0% 0% 0% 0% 4% 0% 2% 4% 4% 3% 1% 0% 2% 0% 1% 0%
Chart 9: How do you currently rate corporate debt as a source of funding for Australian corporates?
Very attractive 15% 11% 12% 4% 5% 2% 7% 6% 4% 1% 0% 4% 3% 2% 8% 7% 5%
Somewhat attractive 52% 50% 52% 45% 50% 53% 52% 47% 53% 42% 29% 41% 27% 24% 41% 29% 26%
Neutral 31% 35% 34% 45% 41% 42% 31% 40% 33% 46% 51% 35% 41% 51% 38% 42% 50%
Somewhat unattractive 2% 2% 2% 7% 5% 4% 9% 5% 10% 7% 16% 19% 27% 21% 13% 20% 16%
Very unattractive 0% 2% 0% 0% 0% 0% 0% 2% 0% 3% 4% 1% 1% 1% 1% 1% 3%
Chart 9: How do you currently rate equity issuance as a source of funding for Australian corporates?
Very attractive 4% 2% 2% 4% 2% 0% 0% 8% 1% 1% 0% 4% 0% 1% 2% 6% 6%
Somewhat attractive 23% 26% 34% 38% 23% 34% 24% 24% 18% 20% 16% 20% 12% 17% 30% 41% 42%
Neutral 46% 43% 16% 36% 47% 43% 48% 31% 36% 31% 18% 34% 30% 26% 34% 24% 31%
Somewhat unattractive 13% 26% 22% 18% 19% 19% 15% 26% 38% 31% 45% 30% 37% 35% 31% 28% 18%
Very unattractive 13% 2% 10% 5% 9% 4% 13% 11% 7% 17% 21% 13% 21% 21% 4% 1% 3%
Chart 9: How do you currently rate internal funding (from profits) as a source of funding for Australian corporates?
Very attractive 31% 30% 34% 14% 13% 26% 17% 29% 26% 15% 29% 23% 27% 33% – – –
Somewhat attractive 42% 41% 46% 50% 48% 38% 43% 34% 36% 61% 44% 43% 47% 39% – – –
Neutral 27% 26% 18% 36% 39% 32% 39% 32% 34% 21% 23% 30% 19% 21% – – –
Somewhat unattractive 0% 2% 0% 0% 0% 4% 2% 3% 4% 1% 0% 3% 5% 4% – – –
Very unattractive 0% 0% 2% 0% 0% 0% 0% 2% 0% 1% 5% 3% 1% 2% – – –
21
Q4 2014
Q3 2014
Q2 2014
Q1 2014
Q4 2013
Q3 2013
Q2 2013
Q1 2013
Q4 2012
Q3 2012
Q2 2012
Q1 2012
Q4 2011
Q3 2011
Q2 2011
Q1 2011
Q4 2010
Chart 10: How would you rate the overall cost of new credit for Australian corporates?
Very costly 0% 0% 0% 0% 2% 4% 0% 5% 5% 7% 8% 13% 8% 7% 2% 7% 11%
Somewhat costly 10% 11% 14% 30% 22% 19% 20% 26% 36% 42% 50% 55% 56% 51% 49% 59% 56%
Neutral 23% 28% 38% 27% 33% 36% 39% 39% 36% 38% 30% 24% 25% 37% 42% 33% 32%
Somewhat cheap 46% 57% 36% 38% 41% 34% 39% 26% 15% 11% 11% 8% 10% 4% 8% 1% 0%
Very cheap 21% 4% 12% 5% 3% 8% 2% 5% 8% 1% 1% 1% 1% 1% 0% 0% 0%
Chart 10: How would you rate the overall availability of new credit for Australian corporates?
Very available 31% 33% 28% 29% 22% 19% 13% 6% 15% 8% 3% 8% 5% 7% 5% 13% 15%
Somewhat available 56% 52% 50% 45% 56% 57% 72% 61% 45% 46% 61% 59% 45% 60% 53% 41% 52%
Neutral 13% 11% 12% 20% 14% 15% 6% 19% 25% 18% 11% 18% 14% 15% 17% 20% 15%
Somewhat hard to get 0% 4% 10% 7% 8% 6% 9% 10% 12% 25% 20% 14% 30% 17% 15% 25% 16%
Very hard to get 0% 0% 0% 0% 0% 4% 0% 3% 3% 1% 5% 3% 5% 1% 0% 1% 3%
Chart 11: What do you think of the level of gearing on Australian Corporate Balance Sheets?
Over-geared 10% 9% 10% 4% 6% 8% 7% 3% 10% 15% 6% 9% 5% 2% 8% 5% 6%
Optimally geared 54% 50% 58% 59% 47% 57% 50% 58% 52% 46% 54% 48% 53% 49% 50% 47% 48%
Under-geared 37% 41% 32% 38% 47% 36% 43% 39% 38% 38% 40% 44% 41% 49% 42% 48% 45%
Chart 11: What is your aim for your level of gearing over the next 12 months?
Raise significantly 0% 0% 2% 5% 3% 2% 2% 2% 1% 7% 4% 8% 10% 12% 8% 8% 3%
Raise somewhat 21% 30% 28% 25% 31% 28% 26% 19% 21% 25% 28% 38% 26% 33% 29% 31% 34%
No change 37% 35% 40% 46% 39% 43% 46% 40% 42% 31% 41% 30% 33% 36% 40% 34% 39%
Reduce somewhat 31% 30% 22% 21% 20% 19% 22% 29% 23% 24% 21% 19% 22% 14% 16% 19% 15%
Reduce significantly 8% 4% 4% 2% 3% 4% 2% 8% 7% 6% 3% 6% 5% 4% 5% 4% 3%
N/A 4% 0% 4% 0% 3% 0% 2% 2% 5% 7% 4% 0% 4% 1% 2% 4% 6%
Chart 12: Is this a good time to be taking greater risk onto your balance sheet?
Yes 27% 30% 44% 55% 44% 38% 24% 34% 23% 14% 23% 46% 25% 45% 49% 52% 45%
No 73% 70% 56% 45% 56% 62% 76% 66% 77% 84% 78% 54% 67% 55% 51% 48% 55%
N/A 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
22
Contact us
National/Sydney
Keith SkinnerChief Operating Officer Tel: +61 2 9322 7580 email: [email protected]
Brisbane
Richard WanstallPartner Tel: +61 7 3308 7179 email: [email protected]
Sydney
Stephen GustafsonPartner Tel: +61 2 9322 7325 email: [email protected]
Melbourne
Paul Wensor Partner Tel: +61 3 9671 7067 email: [email protected]
Adelaide
Jody BurtonPartner Tel: +61 8 8407 7610 email: [email protected]
Hobart
David HarradinePartner Tel: +61 3 6237 7016 email: [email protected]
Perth
Tim RichardsPartner Tel: +61 8 9365 7248 email: [email protected]
Western Sydney
Xenia DelaneyPartner Tel: +61 2 9840 7100 email: [email protected]
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MCBD_Syd_01/15_051310
The CFO Program.
