M’sian businesses to remain moderately upbeat in Q1 2017

KUALA LUMPUR: Business confidence in Malaysia is expected to remain moderately upbeat in the first quarter (Q1) of 2017 despite signs of a downward moderation.

The Dun & Bradstreet (D&B) Malaysia's Business Optimism Index (BOI) study showed that overall, it remained in the expansionary region, but slipping for the third consecutive quarter from +3.83 percentage points in Q4 2016 to +1.65 percentage points in Q1 2017.

The six business indicators under the quarterly BOI study includes volume of sales, net profits, selling price, inventory level, employees and new orders.

Four of the six moderated downwards, while two improved in Q1 2017 on a quarter-on-quarter (q-o-q) basis.

“Both net profits and employment levels fell into negative territory qo-q.

“Net profits fell from + 7.0 percentage points in Q4 2016 to -5.94 percentage points in Q1 2017, while employment slipped from +2.50 percentage points to -0.99 percentage points,” D&B said in a statement here yesterday.

It said the volume of sales moderated downwards visibly from +7.0 percentage points to +0.99 percentage points, and new orders similarly declined from +5.50 percentage points to +1.98 percentage points.

Meanwhile, both selling price and inventory levels improved q-o-q.

Selling price rose from +0.50 percentage points to + 9.41 percentage points and inventory levels jumped from +0.50 percentage points to +3.47 percentage points.

D&B added, on a year-on-year basis, BOI fell moderately from +4.75 percentage points in Q1 2016 to +1.65 percentage points in Q1 2017.

Dun & Bradstreet (Malaysia) Sdn Bhd Chief Executive Officer Audrey Chia said: “Moving into 2017, we expect Malaysian businesses to err on the side of caution in their investment decisions for expansion plans.

“Global economic uncertainties, higher business costs and reduced sales are some of the key challenges which have been highlighted by local firms.”

This is the 16th D&B BOI study being released in Malaysia.

The survey, conducted quarterly, includes respondents from 200 business owners and senior executives representing major industry sectors across Malaysia. — Bernama