CEO survey points to more expectations of higher revenues

Most chief executive officers in the Philippines remain optimistic their firms’ revenues would grow in the next 12 months, according to the latest survey of PwC and the Management Association of the Philippines (MAP).

While most business leaders in the Philippines are still upbeat on revenue growth prospects, the proportion has decreased compared to last year.

Results of the PwC MAP 2018 CEO Survey titled “The future of possibilities: Business in the age of disruption” showed 89 percent of business leaders said they have a positive outlook on their organizations’ revenue growth prospects in the next 12 months and expect it would be better than industry growth.

The percentage of CEOs who have a bullish outlook on revenue growth in the latest survey is lower than the 92 percent who said they were confident their revenues would increase last year.

The optimism is due to higher disposable income from the first package of the tax reform program which took effect earlier this year, expected higher government spending and the ongoing implementation of the government’s Build Build Build program for infrastructure development.

Jade Roxas-Divinagracia, managing partner for deals and corporate finance at PwC Philippines, attributed the decline in the percentage of CEOs who have a positive outlook on revenue growth to concerns on the high inflation rate and continued weakening of the peso against the dollar.

“On the external front, there is threat in terms of normalization of more developed nations. There is fear of outflow of funds from emerging markets back to developed countries,” she said.

Conducted from July to August, the survey covered 122 respondents, with 103 from traditional businesses and 19 from startups.

Apart from being hopeful revenues would grow this year, the survey also showed 79 percent of CEOs expect Philippine economic growth forecasted at 6.7 percent this year, to exceed the average in Southeast Asia seen at 5.2 percent.

In terms of going global, CEOs in the country said Singapore, Indonesia and Vietnam are considered the most important countries for their companies’ overall growth in the next 12 months.

Singapore attracts foreign players because of its healthy fiscal position and favorable business environment, while Indonesia has a growing consumer market and Vietnam’s government has been pushing for trade and investment liberalization.

As 94 percent of CEOs in the Philippines believe the disruptive innovations have changed their industry over the past 10 years, they are looking at various strategies to harness disruption.

In particular, 79 percent said they are looking at forming strategic partnerships, while 75 percent are planning to invest in new technologies.