Most lo­cal CFOs ex­pect to en­joy profit growth: sur­vey

The China Post - - TAIWAN BUSINESS -

Most of the chief fi­nan­cial of­fi­cers of Tai­wan’s largest com­pa­nies ex­pect to see an in­crease in prof­its this year, ac­cord­ing to a re­port re­leased Thurs­day by Bank of Amer­ica Mer­rill Lynch.

The level of con­fi­dence among CFOs in Tai­wan is the sec­ond high­est in the Asia Pa­cific re­gion af­ter In­done­sia, Mer­rill Lynch said in its 2015 CFO Out­look Asia re­port.

The re­port was based on a sur­vey among 630 CFOs and se­nior fi­nan­cial man­agers of big com­pa­nies in 12 re­gional coun­tries and ar­eas, namely China, Ja­pan, In­dia, In­done­sia, Malaysia, the Philip­pines, Sin­ga­pore, South Korea, Thai­land, Tai­wan, Aus­tralia and Hong Kong.

Nearly 97 per­cent of the com­pa­nies have global an­nual rev­enues of at least US$500 mil­lion.

Wayne Liaw, chair­man and man­ag­ing di­rec­tor of Bank of Amer­ica Mer­rill Lynch Se­cu­ri­ties Tai­wan, said the op­ti­mism among Tai­wan CFOs can be at­trib­uted to a steady growth of the econ­omy, im­prov­ing con­sumer con­fi­dence, and a grad­ual re­cov­ery of busi­ness con­fi­dence in a sta­ble pol­icy-mak­ing en­vi­ron­ment.

He said, how­ever, that de­spite the high level of con­fi­dence among the Tai­wan CFOs, there is still con­cern over po­lit­i­cal risk, as ex­pressed by 83 per­cent of them, the high­est per­cent­age among all the Asian coun­tries in the sur­vey.

Tai­wan CFOs, in par­tic­u­lar, tend to in­crease their eq­uity weight­ing on the bal­ance sheet and build cash re­serves, the re­port said, adding that 80 per­cent of them are plan­ning this year to re­serve more cash, com­pared with 67 per­cent last year.

On the other hand, not many Tai­wan CFOs are in­ter­ested in merg­ers and ac­qui­si­tions, as in­di­cated in the poll, which showed that only 17 per­cent of them plan to use com­pany cap­i­tal this year for such pur­poses, a steep drop from 33 per­cent last year, ac­cord­ing to the re­port.

It said there is even less in­ter­est in ap­ply­ing for loans for merg­ers and ac­qui­si­tions, with only 10 per­cent of Tai­wan CFOs look­ing in that di­rec­tion, com­pared with the av­er­age 26 per­cent among all Asian CFOs.

The Chi­nese mar­ket is still a fo­cal point, the re­port said, adding that 60 per­cent of Tai­wan CFOs plan to in­vest there, although they are closely ob­serv­ing the ef­fects of China’s slow­ing eco­nomic growth and shift­ing poli­cies.

Newspapers in English

Newspapers from Taiwan

© PressReader. All rights reserved.