Australian firms are expecting a positive start to the New Year with improved expectations for sales, profits, capital investment and inventory levels as broader signs of a strengthening economic recovery take hold, a new survey shows.
According to the latest Dun & Bradstreet (D&B) Business Expectations Survey, Australian businesses are more optimistic about the future, expecting improved trading and investment conditions for the March 2010 quarter.
The survey found that 12 percent of firms expect to increase capital investment, while just four percent are planning to decrease spending in this area. Inventory expectations have also reached their highest level in six years, with 19 percent of executives expecting to increase inventories in the March 2010 quarter. The outlook for sales and profits has also continued to improve, with 49 percent of firms expecting an increase in sales, an 11 percent rise on last quarter.
According to D&B CEO Christine Christian, the continued improvement in capital investment expectations is an important sign for the recovery of the Australian business environment.
“Capital investment is crucial to Australian businesses being able to meet customer demand and return to economic prosperity in 2010,” she said.
“If businesses can manage the balancing act of improving sales and profits through the principles of good cash flow management, while at the same time investing in their business to improve productivity, this bodes well for the Australian business outlook in the first quarter of 2010.”